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Fixing Capitalism: Michael Porter And Robert Reich

Business guru Michael Porter and former labor secretary Robert Reich on how to fix what ails contemporary capitalism.

Traders work on the floor of the New York Stock Exchange. (AP)

Traders work on the floor of the New York Stock Exchange. (AP)

Business – American business – has been under a very critical microscope lately. On the crash, the environment, the jobless recovery and more, a country of boosters has become, widely, a country of skeptics about how big chunks of capitalism are working. Business super-guru Michael Porter says American business has brought it on itself. And it has to change. To very clearly – more clearly – create value for itself and the whole society. It’s the new way to profit, he says.

A discussion with former Labor secretary Robert Reich and Michael Porter on fixing capitalism.

- Tom Ashbrook

Guests:

Michael Porter, world-renowned expert on how companies and nations compete. He is director of the Institute for Strategy and Competitiveness at Harvard Business School, where he is a University Professor. His article “Creating Share Value: How to reinvent capitalism – and unleash a wave of innovation and growth” is the cover story of the January/February issue of Harvard Business Review.

Robert Reich, he was Secretary of Labor under President Bill Clinton. He is now a professor of public policy at the University of California at Berkeley. His books include “Supercapitalism: The Transformation of Business, Democracy, and Everyday Life” and “Aftershock: The Next Economy and America’s Future.”

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  • twenty-niner

    Mr. Ashbrook,

    I’m sure your guests are going to spout the same tired tripe about American workers needing to go back to school to get more training. I have been working as a professional engineer for over 15 years, and I can tell you, kids graduating from engineering school know just enough to be dangerous. The real education happens on the job, working on real projects with hard deadlines, under the guidance of senior engineers.

    Let me repeat: the job is the training. Your degree means that you know some applied math and physics; but more importantly, it means you’ve hopefully learned how to learn. But without a meaningful first job, all of that raw knowledge will not congeal into anything useful.

    We need the equivalent of Kennedy’s moon shot to put young engineers to work, en mass, building something significant. This is how to train the workforce of the future.

    • mrfreeze

      29er – I couldn’t agree with you more. The problem is that, for some strange reason, no-one (not Congress, not business, not even the American people) want to invest in the very projects that would train (and employee) new workers: it’s called our infrastructure! OH, but just say high speed rail or “capital investment” to anyone these days and you’re shouted down, “we can’t afford those types of projects.” The sad thing is, America is on the quick road to banana-republicville due, in large part, because Americans have been taught to believe that success comes in the form of a telephone and a good text message, not “producing” things.

      • WINSTON SMITH

        “Invest” is code word for “spend”. If with a $3+ trillion budget we don’t have enough money for reasonable infrastructure projects, then something is wrong with how we are spending our money. The real problem is that Democrats and Republicans have both painted us into a corner that we can’t get out of. Democrats created the social security/medicare mess, and Republicans passed unaffordable tax cuts for the rich. A $14 trillion deficit heading toward $20trillion is soooooooooo rediculous and unsustainable, the train has already left the station in terms of having any reasonable chance to fix it. It’s just a matter of time before our financial system implodes.

        • Gregg – Taylorsville, NC

          There was not a single penny “spent” on tax cuts. There were no tax cuts, just a bipartisan agreement not to raise taxes on every single taxpayer.

        • Jim in Omaha

          There is no “social security mess”. People like myself, age 58, have FULLY FUNDED their own requirements, creating a surplus of over $2 trillion that won’t be exhausted for several decades. On the other hand, there is a “medicare mess”. Recipients of Medicare fall far short of paying the cost of the benefits they receive. Any person or politician that talks about a “social security” mess or shortfall is woefully uninformed and their views on this subject can not be trusted.

    • Tina, RI

      Yes! AND, we need Campaign Finance REform so that people from more varied professions can serve in our Congress — ESPECIALLY including engineers, architects, scientists, artists, musicians!!!

      Thanks for your great comment!

    • Zeno

      I agree. How many times have I seen the Job training at the local office or even at trade schools sitting down some unemployed plumber, carpenter, manager, etc, (who lost their jobs to wage suppression and/or in-sourcing) to learn Excel or some other computer related dump zone skill, even if they have the natural aptitude for it.

      The truth is that these people are NOT going to find employment working on a computer as corporations are outsourcing these jobs as fast as they practically can. Even people who have 20 years of experience with software applications cannot find work in this field.

    • Ellen Dibble

      This morning’s news report our state treasurer pushing a hundred million dollars into the 200 local/state banks targeted to “small businesses,” which he says constitute 85% of our jobs. He wouldn’t define “jobs,” but he wants a fair rate of interest for the taxpayer money going out the door to our banks for this, and he wants quarterly reports back to Uncle Massachusetts.
      I was fine till he said quarterly reports.
      I think capitalism as we know it allows for investment (apparently even publicly funded investment) to be of the Ponzi variety. Let me pull back that exaggeration a bit: American capitalism calls for a business plan that has a trajectory more in sync with “making a killing,” one fitting into a well-traveled groove of profit, rather than a business with a trajectory that involves years of learning curves, new training paths for new skills, plenty of the kind of stumbling blocks that new departures almost inevitably encounter.
      Quarterly answerability reduces “innovation” hugely.
      Capitalism is designed to reproduce excess, not encourage new kinds of sustainability.

  • Wm.James from Missouri

    Mr. Robert Reich,

    I always enjoy listening to your thoughts on economic issues. I am betting that this show will be addressing current “hot topic” issues, which is understandable but I do hope that you might find the time to mention current trends in stock trading, in particular, the accelerating use of high speed computers and advanced algorithms that use expert systems and neural networks.

    Wired magazine recently ran an article on this subject.( I do not have the issue in front of me, so I can’t give you the date.) The article mentioned that some traders were relocating their mainframes to gain a fractional second advantage ! Ray Kurzweil and others have made this case for ever accelerating intelligent machines. These two facts alone demonstrate, to me at least, that there will come a day when humans, will not be able to compete in any such investment arena. The thing we call Capitalism must morph into something that we would consider more bio-friendly if we are to sustain life on this planet.

    { I make this final note, with these three items, to reinforce the idea of the speed at which things seem to be happening:

    ___ IBM recently announced plans to build a computer that will run
    at 10 ^ 18 flops, that is about 100 times faster than a computationally
    equivalent human brain, delivery time: estimated 8 years

    ___ INTEL has developed an optical device that will be fast enough to allow
    a user to download a full High Def DVD in one second

    ___ Various institutions are working with 3-D printers that will allow for the elimination, someday, of anything we might now call a manufacturing plant,
    as it will concentrate many labor task into one

    I must note that the last item might work to the advantage of the “little guy”,
    It is quite unclear to me as of this writing. }

    • Tina, RI

      Wm. James,
      Thank you! You “flesh out” the stuff I tried to mention on my List (my lengthy, awkward List), but with information that I’m completely Unfamiliar with. Your comments, and the others posted during this late-night, early-morning period, are PERFECT, because they are NOT about “spin” — you are using the new terminology that we will all need to listen to & understand! You are so On Target when you refer to the need to be “bio-friendly”!

      • Wm. James from Missouri

        Thank you for your kind words. I found your post very worthwhile also. I hope to find time to respond in the next couple of days. The sandman beckons.

  • Rondem1

    questions-
    When did “balancing the budget” become paramount over helping people meet their needs?
    Heard rep Ryan say Obama’s budget “adds 13billion dollars to the deficit” That’s not right is it?
    He also said ‘they don’t factor in the increase in taxes in two years.” So is this another way to say ‘make the tax cuts for the rich permanent?
    -How do you reduce deficits by reducing taxes, thus income?
    -Shouldn’t we be looking at working for the government from the other direction? When shared resources (taxes) help employ millions, when there is constant ‘churn’ in private industry, isn’t it a sign of something actually working? who will take up the slack when ‘budget balancing’ throws thousands out of ‘government’ jobs?
    -and the big one- who will have the stones to stand up and reiterate that government is NOT the enemy- unless you allow those with louder voices to make it so.

    • Worried for the country (MA)

      “Heard rep Ryan say Obama’s budget “adds 13billion dollars to the deficit” That’s not right is it?”

      Nope, that was $13T over 10 years.

      Since the debt is now over $14T how large do you think it can get before the system collapses?

      • Craig from Omaha

        The system is more likely to collapse from the failure of conservatives to realize that global petroleum production has reached its peak and prices will rise dramatically as we compete with Europe, Asia and even less developed countries for resources. Fixing the deficit requires increasing revenue such as progressive taxation of high earners, sensible taxes on energy consumption (extend the “gas guzzler tax to oversized SUVs and 4×4 pickups for starters), the proposed excise taxes on carbonated soft drinks and “energy drinks” — among others PLUS the realization that there need to be meaningful cuts in a bloated defense budget. This will entail a rethinking and restructuring of our armed forces. Does the US Navy really need a dozen carrier groups, for instance.

        As for Rep. Ryan of Wisconsin – he is a 40 year-old twit who has been in Washington ever since he graduated with a BA in poly sc from Miami of Ohio — first as a Congressional aid, and then as a Representative from Wisconsin’s 1st district. Just over 2 years ago, GM closed an assembly plant in his hometown of Janesville that produced oversized SUVs [Chevy/GMC Suburbans, Tahoes) and big pickups. He has yet to realize that that product emphasis is part of the energy-petroleum consumption problem.

  • Brian

    Sorry, but nothing short of a constitutional amendment to fix campaign finance will fix US capitalism.

    Until then, big business will always be able to successfully fight any sort of meaningful reform (be it financial, anti-trust, net neutrality, environmental or otherwise).

    • Tina, RI

      Brian, IF the Democrats win in 2012, maybe this should be the BIG, BIG EFFORT that we all make — to convince our own sadly “bought and paid for” Congressional delegations that THIS is what they MUST DO! We’d HAVE to NOT be negative (like I just was with my bought & sold comment)! We’d have to believe we could really do it! After Egypt, my Optimism is UP. BECAUSE the current state of Capitalism today gets me down, I was AWARE of how TRULY the peaceful efforts of the Egyptians reminded me that humans CAN change things successfully & peacefully!

  • Tina, RI

    Someone mentioned on an earlier OnPoint Comments page that there is a law which requires companies and corporations to owe their allegiance to their shareholders rather than to their employees, or the environment, or to various social considerations. Can this law be changed; not eliminated, but changed to reflect a more balanced set of responsibilities to ALL of those involved?

    THAT comment made me ask, on an earlier OnPoint webpage, if we could all put our heads together with some ideas about “tweaking” our current form of Capitalism. When I read of today’s topic, I decided to go back & read as many recent comments as I could so that I could put people’s ideas into one List. I don’t know this language that well, so PLEASE FORGIVE ME, I just wrote the List using regular colloquial language. The overall intent is at the END. Otherwise, here goes (forgive me, please, for the length and for the audacity!)

    It seems like whatever Economic Recovery we are experiencing is from the “Financial Capitalism End Point” of the “Capitalism Trajectory”. I don’t know if this is a real phrase, but I use it to describe:

    The situation where investors do NOT invest (or, do not invest MUCH) in research, design, capital equipment, etc. Instead, they seem to “play” with money and/or numbers and/or with “ownership”. The investors I’m talking about are the ones who operate with such large amounts of funds that it is THEY who “shape” our entire Economy. IF there is an Economic Recovery that is starting to happen, it is because of THEM and is also pretty much CONFINED to them. They are small in number, yet are wielding gigantic amounts of money. Their money is making money (not products), in almost a “fractal” pattern. (Yes, some other corporations DO “invest” in the older understanding of the term, but they are NOT the dog, not the tail, they are NOT wagging our Economy. Whereas, the “Financial Capitalists” ARE wagging our Entire Economy.)

    They make more money helping customers “finance” their purchase (that is, helping customers get loans for their purchases thru the company) than they do from the profit they make on making, then selling the product. Also, they want the financing to go thru THEM, not thru a bank or other loan organization.

    They make more money selling the corporation to another corporation (Buy Outs) than they do by making a profit selling whatever it is they make or service.

    They also make money thru mergers; acquisitions (eventually; maybe immediately?); using the business as collateral; or thru changing the terms and/or the types of legal ownership designation of the corporation; thru Vertical Integration. Big corporations keep “cornering the market” thru “deals” they offer would-be customers (the coupon from your pharmacy, say, is for a restaurant, only it’s a chain restaurant, not the local Mom & Pop restaurant. The pharmacy might even OWN the restaurant.).

    They make money thru credit default swaps and other “financial deals” (including other deals I don’t know the names of) and will continue to do so “Off Shore” (in the Caribbean) even AFTER Elizabeth Warren does her best to stop these practices.

    They SAVE money already thru Off Shore tax shelters.

    They SAVE money thru federal deals that lower their corporate tax rates.

    They MAKE money thru FEDERAL subsidies (aka “corporate welfare”). They also get LOCAL subsidies and tax breaks, as when a Big Box store arrives in town & gets deals & breaks that the little, local merchants don’t get; in fact the little guys don’t even get any compensation when Big Box puts them ALL out of business!

    They MAKE money by betting that the stocks &/or bonds of other corporations will go DOWN (maybe I said that already when I mentioned those complicated terms earlier).

    They MAKE money due to the fact that there is no federal cap on interest rates (no usuary laws that apply to corporations). (Just like everything else on this list, please add, “I think”)

    They SAVE money by Outsourcing American jobs to the areas of the world with the lowest wages possible for the quality of work that is desired. (After slavery was outlawed, African-Americans suffered peonage which benefitted REALLY large corporations, as well as widespread wage discrimination which benefitted ALL other Americans who bought products or services; after Jim Crow, women were finally hired, at lower wages; after that, more teenagers HAD to work for family income, not date money; then jobs left the Northeast for North Carolina; then jobs went to Mexico, then, eventually to other poor countries, and finally to China. I call this the “Natural Trajectory of Capitalism Seeking the Lowest Wages possible, at least after slavery was ostensibly outlawed worldwide. By the way, has it been, really?!)

    They SAVE money by using more & more robotics. The robots are NOT taxed as workers would be, thus, the federal “till” is no longer filled thru income tax. Instead, corporations are going to receive HUGE tax DEDUCTIONS or CREDITS for investment IN these robotics! Good bye jobs and benefits! Apparently, this deduction OR credit (not sure which) is a New Initiative, put in place after our recent Economic Breakdown.

    RE: Financial Speculation — are corporations taxed on any high-risk financial speculation they might engage in? When their speculative ventures failed, they seem to have been Bailed Out.

    RE: Personal Income Taxes on Investments — investments are taxed at a lower rate than hard work is, I think. (Since most people hope to retire at some point, there is some sense in this, but could the rate be age-dependent, unless disability was also involved?)

    RE: the workers AT the corporations — CEOs get BONUSES for Out Sourcing workers’ jobs and/or for increasing the number of Robotics used.

    RE: the workers AT the corporations — there does NOT seem to be any tax penalty put on corporations when CEOs and other Top Earners earn grossly more, proportionately, than the lowest-paid wage earners.

    Also: there do not seem to be very many companies and/or corporations that are owned by the employees, or that allow the employees to benefit directly in the profit. (Some employees have been given stocks/bonds in lieu of benefits and/or in lieu of full retirement packages, or their expected retirement packages, often when management KNOWS that the stocks/bonds will soon be worthless. I do not know if there is a penalty for this, especially if prior knowledge, & thus malfeasance, can be proved.)

    RE: our federal income tax code — we just gave tax cuts to the wealthiest Americans who already own a disproportionately large section of our entire Economy (is it top 2-3% own 97%?). Millions of Americans have been jobless for a long time and will continue in this fashion, often WITHOUT health insurance, often WITH illness/disability, often WITH huge college loans, often having lost their homes to foreclosure.

    RE: cheap labor. Many of the wealthiest Americans employ domestic staff who are here illegally. When caught, the immigrants are deported; yet I am unaware of staggeringly appropriate prison time for their employers for breaking federal immigration law. A young “entrepreneurial” African-American male from one of our inner cities will see significant prison time if he is caught doing something illegal, perhaps selling drugs. He will have the crime on his record for his lifetime. Will the wealthy employers of the person here illegally see something similar happen to them, especially if it also becomes clear that they employed people illegally at their workplace, as well? Or, will they simply get a slap on the wrist which they will “flip” to open their wallet to see the extra money sitting therein due to the money they SAVED on their cheap labor?

    ### I’m CERTAIN that I’ve made MISTAKES, and I apologize. I would like to know HOW CAPITALISM CAN BE TWEAKED TO GET RID OF SOME OF THE GLARING INEQUITIES THAT THE PRESENT FORM OF CAPITALISM ALLOWS, as I hope I’ve shown with my Awkward List. AND, I apologize for the length and unwieldy nature of my List. There ARE mistakes in it; but there are ALSO important notions to discuss that I’ve gleaned from reading these Commentary Pages for several years now. That is to say, it is OTHER OnPoint LISTENERS who contributed to the BEST parts of this posting. But, ONLY I am responsible for its overall awkward form and for its mistakes.

    I bring up all these NEGATIVES, because I’m SURE THAT WE CAN PUT OUR HEADS TOGETHER TO TWEAK CAPITALISM ENOUGH THAT IT STARTS TO WORK FOR EVERYONE IN OUR NATION, IN A TRULY BALANCED WAY (& I’m CERTAIN that a Trickle Down Theory is NOT gonna be the answer!) Americans have so much Creativity, Intellectual Curiosity, Physical & Manual Skill, Spirituality, Generosity, Inventiveness, and THIS CURRENT FORM OF CAPITALISM is NOT allowing people access to their Own Giftedness, or to their Own Ability to Contribute to the Health and Wealth of the Nation and/or of themselves. These current “Financial Capitalism” Schemes and Deals are NOT a good, broad, or strong enough Foundation for the kind of Economy we need to THRIVE!

    Dr. Reich and Dr. Porter, PLEASE HELP US UNDERSTAND WHAT NEEDS TO BE DONE! Thank you SO much, and AGAIN, my apologies to Everyone!

    • Wm.James from Missouri

      Tina,

      You have touched on so many topics, that I scarcely know where to begin. I am sure these issues will come up again in the future and as I do not know you I can not be sure ,as to what I might say that will help you. So I will just take some clips from your post and respond with word strings and short unfinished phrases. You might think of them as “links” to subjects that might help to clarify things for you.

      “Financial Capitalism End Point…” , your correct. To many business people don’t love there business, they just love the money it generates. I can’t prove it but I feel this originates in personal insecurity. It may be a type of neuroses. I’m not saying this to be cruel. I have noticed this trend forming over the last 30 + years.

      “The situation where investors do NOT invest (or, do not invest MUCH) in research, design, capital equipment ….” I disagree. Many big business do invest large sums of money in R&D. The real problem, as I see it is that the “little guy” can’t afford to do these things himself. I have several ideas, myself. I have spoken with patent attorneys. The last one wanted $225 / hour!
      This does not include any possible challenge that might arise, nor does it include international patenting cost. The little guy has been locked out. If Edison were alive today, we would still be living in the dark!

      “They make more money selling the corporation to …” Yes. The problem here is one of accurate accounting practices. Stockholders do not really know the value of the company they have invested in. Bigness and inter-nationalism makes it very difficult to mark to market. Technological obsolescence and technological change, in general, also make it difficult to “get the big picture”.

      “They make money thru credit default swaps..” Quick story. I have a relative that is a CPA. I asked her once, if she had thought thru the possible problems that credit default swaps could cause ( I had.) She swore up and down that every thing was OK. See believed it. It’s is hard for all people, even educated people to accept the fact that , we can’t know it all .

      “Off Shore tax shelters…” This is a no brainer. I pay, you pay !

      “MAKE money by betting that the stocks &/or bonds of other corporations will go DOWN …. This is actually a good thing. Prices have to move if progress is to be made. The problem here is one of layering, and repackaging in a non transparent manner. We should all be introduced to COVERED Puts and Calls. Their “time to expiration” can be a problem, though. They should be longer.

      “They SAVE money by Outsourcing American job…. Outsource nothing to anyone who does not have an American “like” constitution that guarantees rights to it’s citizens. Even American could use some competition.

      Tina, I think I will stop here. I hope to see you post again. Thanks.

      • Tina, RI

        William, I just got home & saw your wonderful post with information for me! Thank you SO very much! I exhausted myself so much last night that I HAVE to take a nap IMMEDIATELY & before other obligations tonight. So, I’ll be checking on your post tomorrow when I’m fresh. I haven’t even heard the show yet, as I was out when it aired. As much as I LOVE this show, immediate SLEEP takes precedence over even listening to the podcast! Last night, when I had energy, it was all directed towards trying to get some clarification so I could help change Capitalism toward something the Little Guy CAN THRIVE IN! Glancing at what you wrote, I think I can see that some aspects of the way things are now do affect the Little Guy adversely. Thanks SO MUCH!

  • Wm. James from Missouri

    Hey, here is doable restructuring idea.

    Require all publicly traded companies, having assets over a given threshold to pay a dividend on all shares, including ( in house ) treasury shares. This will eliminate all “funny money” accounting, and prevent the hoarding of cash. This would increase the velocity of money, and increase productivity. Taxes should be paid on all shares, floating or not ! This will force shares out or clean up the books or both.

    When you have to come up with the cash, you have to be doing something to generate that cash. Companies today are holding over 1 trillion dollars in non performing cash or equivalents. Stockholder rights have been high-jacked by unscrupulous paper juggling, corporate hucksters, whose modus operandi undermines the interest of the American populace, by redistributing over 300 years of the accumulated wealth, of all that have worked so diligently since the founding of this country, to internationalist raiders.

    Wouldn’t you like to know where your money is ?

    Once again, I recommend that you listen to the prior Sept. 17, 2008, On Point show, entitled, “Getting outside the box .” The problems we face as a nation are many and difficult. By breaking away from past century practices we may be able to overcome our failings.

    Become your own Iconoclast. Be bold ! Be new ! Make good happen !

    Think outside the N-Dimensional Construct !

    • Gerald Fnord

      Limited liability used to be something royalty granted to their friends…guess what.

      And you’re too timid: ‘Think outside the {N+1}-Dimensional Construct !’ more like.

      Dilute! Dilute! O.K.!

      • Wm. James from Missouri

        On ——– …. {N+1+} ….

        You may have missed my post at: “Getting outside the box .”

    • Rutlander

      Very reasonable, Wm James. But haven’t we gone beyond the point where this is something that our government can accomplish? Our government is bought, lock, stock, and barrel, by corporations. The Citizens United case pretty much confirms this. Our “impartial”
      Supreme Court is in the pockets of the corporations. We’ve lost our chance at ‘fair and balanced” capitalism.

      • Wm. James from Missouri

        Rutlander,

        I sure hope your wrong. However, in the event of the worst case scenario, we can take solace in the phrase. We won’t get fooled again….

    • Tina, RI

      William, I just wrote you a reply, only to LOSE it when I hit “Show Bookmarks” so I could check a fact! Basically, I said I hoped to write you back again in the next few days to ask you more about your ideas, as I’ve still not finished hearing the entire podcast or reading all the Comments for this show. I can’t begin to say I understand all that you’ve spelled out, so, I’ll tackle the context of the show first, to see if that helps me ask you my questions more intelligently.

      In the meantime, I asked you, and Gerald, and Rutlander and All Others if you’d heard the news today (on NPR, Feb. 16) about RUSS FEINGOLD’S NEW P.A.C. — PROGRESSIVES UNITED!!?? He has formed it SPECIFICALLY TO TRY TO COUNTERBALANCE and/or COUNTERACT THE EXCESSIVE POLITICAL INFLUENCE THAT IS HELD BY THE GIANT CORPORATIONS, especially SINCE THE SUPREME COURT’S CITIZENS UNITED DECISION!

      Anyone intending to go to the site will have to be on the Alert, however. Feingold’s P.A.C. is called “PROGRESSIVES UNITED”; yet there seems to be another organization called “United Progressives”.

      With our IDEAS (from good hunches to brilliantly specific solutions) and our COMPUTERS — and now, with a P.A.C. (created to tackle the very issues we’ve been talking about!), MAYBE WE CAN “PULL AN EGYPT” — that is, pull forth a Revolution of changes to our Capitalist system, thus creating a more balanced & fair form of this kind of economic model!!

      I want to see laws & regulations & taxation policies that are more fair & equitable to the workers, especially beleaguered American workers, and to American small business owners & independent contractors (architects, designers, per diem professionals, household & maintenance workers, C.N.A.s, etc.); and I want environmental protection to be seen as an opportunity for jobs & NOT as a hindrance to business & profits!!! (IF things don’t change, I, personally, am returning to my preference for the Social Democrat model I’ve seen in Sweden & Denmark, as a caller to this show said he preferred.)

      Thanks, again, for the discussion!

    • Tina, RI

      And, I forgot to quote, Goethe, I think, per YOUR great phrases of encouragement, above:

      “Be Bold, Be Bold, Lest Your Luck Run Out!”

      And, as a neighbor says, “Take Every Opportunity for Transformation!”

      Yes! Let’s “Pull an Egypt” on our current form of Capitalism!

  • Yar

    Fixing Capitalism, isn’t that a little like fixing gravity? Capitalism isn’t broken, other than we are calling oligarchic trade, free trade in the name of capitalism. We are using laws bought and paid for through lobbying and campaign contributions, (what we are calling free speech) and calling that capitalism.
    Free trade capitalism requires equal information on both sides of every transaction, yet most trade in today’s economy is the purchasing or selling of information. Information is not a product, yet it is essential for life.
    Life, liberty, and the pursuit of happiness are tenets of a free society. Yet today we live in a society where life is purchased from agribusiness, water utilities, and electric companies. Liberty is a balance of exploitation and being exploited through economic slavery. Happiness is lost because we are mired in debt,

    A free society is a society with the knowledge to make good decisions and markets that are regulated to prevent exploitation. We disgustedly call that socialism, failing to realize without education and regulation we lose our freedom of choice. Democratic government is socialistic, its function is to keep society stable.
    We are always in tension between trade, and stability. When self governed people (democracy) works properly then we have a functioning hybrid economy that balances both trade and regulation.

    This is an academic statement from a philosopher/farmer who loves his country, and is freely giving time to this blog, in order that we may form a more perfect union. Farmers are blessed with time to think, and exposure to natural limitations, where an understanding of balance exists. In my opinion these ideals are what built our democracy. We have lost our connection to the land and no longer know the measure of ourselves. It is not too late, some simple changes can salvage our badly damaged democracy and return our economy to free market capitalism our founding fathers envisioned.

    The first step is to stop our elected representatives from raising money while in office. The second step is to closely regulate selling of information. Return the stock market to a capital market and remove the casino. Third we must educate our youth in social responsibility, I would attempt do that with two years of public service, where we prepare our nation’s children to own the country we are building for their generation. We work for them, hoping they will take care of us.

  • WMaher

    Only NPR could bring on Robert Reich, a socialist career government hack to the left of Lenin, to enlighten the masses about the genuine definition of capitalism. For the regular lefty NPR types, this note would not remotely faze them as to where NPR is coming from. Remember, socialism is holding up the head of NPR–NPR(a.k.a., government radio) obviously couldn’t survive on its own merit and here they are, of all people, speaking as authorities on capitalist discourse. Has Robert Reich ever had a legitimate job where let’s say, there is a possibility he could be fired according to his production level, etc? Where? If you haven’t noticed, Robert Reich’s and Paul Krugman’s “capitalist” blueprint isn’t working out too well in Greece, is it? What’s next– Bill Clintonist and Tiger Woods to enlighten us on family values? And Harvard University, the breeding ground for American Leninists(FDR comes most immediate to mind), is just where to look for a discussion on capitalism. Has anyone noticed that Robert Reich, nor Paul Krugman, has had anything to OFFER on the wonders of the socialist train wreck in Greece? I’m shocked!

    • Gundy

      Feel better?

    • Cory

      Aah yes… production! If you don’t produce widgets fast enough Mr. Cratchett your children shall go hungry!! The classic conservative belief that something is not worthwhile if it doesn’t produce profit. So sad and short sighted to think a guest can’t contribute because he has had a career in academia and public service. How about Socrates, Kierkegard and Sartre? Who did they make widgets for? Did any of them have anything worthwhile to contribute? In my opinion, this is an ignorant conservative stance.

    • Margbi

      There, there. Sit down and breath deeply and you’ll soon feel better..

    • Yar

      @Wmaher, you spit out the words “a socialist career government hack to the left of Lenin,” with such disdain, I wonder what principles guide your in managing you family? Is it an equal democracy, where your children have equal say in family budget, or are you a “Leninist” dictator where your say is law. Or do you consult with your wife to educate and train your children in the responsibility of citizenry? Why are you so angry? Are you angry because you are exploited by oligarchs.
      Democracy takes education, listen carefully, you may learn something from a socialist career government hack.

    • Zeno

      Yes lets get a CEO from a US corporation to speak about “True” capitalism. How about GE…oops its supported by the peoples money. How about GM…oops again. How about Exxon…oops, How about Citibank, AIG, or any of the multinational IBs?…oops they are all supported by the peoples money. How about the big Agribusiness companies…oops again. How about pharmaceuticals or petrochemicals…oops again How about Boeing or Lockheed, nope same problem.

      Perhaps you can suggest a successful US corporation that is NOT sucking on the taxpayers teat.

      • Dave in CT

        Right on. I hope all who liked this realize that Central Planning Democrats love this model, Golf Crony Republicans love this model, and only Libertarians seem to consistently raise the issue and fight against it. Let alone the ties to Militarism that keeps it all going round.

        http://mises.org/default.aspx

        http://www.campaignforliberty.com/

    • Rutlander

      Interesting that you should use Greece as an example. According to people who know the Greek economic and governmental culture more intimately than the typical Glenn Back follower, the biggest problem in Greece is that those who have want to keep. Tax evasion is widespread, bankrupting the government anbd forcing the lay-off of those very workers that keep a government going. FDR as a leninist shows your degree of ignorance. Just because a leader considers the plight of the 20% unemployed in his country doesn’t make him a Leninist. FDR was considered, however, a “traitor to his class” because he expected the wealthy to cough up enough of their weallth to get the country going again and that wasn’t a good enough goal for them. Like the wealthy Greeks, they had their money, often inherited, not earned, and the rest of humanity could go to hell.

    • Wm. James from Missouri

      Would you have us fill our heads with the private sector, puerile verbal diarrhea of Howard Stern, or maybe, the dogmatic rantings of a hypocritical, fat, drug user, sprouting hate speech thought priming ideas ?

    • Craig from Omaha

      You hard right Fox News viewing/talk radio listening reactionaries like to use the small nation of Greece as an example, but you always ignore the example of the largest and most successful country in the European Union, Germany. How could you argue with a successful economy with a trade surplus, lower unemployment rate, a strong manufacturing economy emphasizing high end products, a longer average life expectancy and a higher standard of living (when you factor in the cost & quality of medical care and 4 to 6 weeks of paid vacation). Germany is not only successful, but is better positioned for the challenges of the 21st century than we are. And yes, Germany has a more humane capitalism and its current political leader is Frau Angela Merkel (yes a woman!) of the conservative Christian Democratic Party. But hers is an enlightened, relatively progressive conservativism.

  • Cory

    One word… REGULATION!!! If you are going to use greed as the engine of your civilization, you must harness it or abuse will be common. We cannot rely on common decency and self policing. Most people fall somewhere in the range between frail and wicked, and will harm one another for their own benefit.

    Unless of course you are one who wishes to benefit at the expense of your fellow man. Then I would suggest being careful to keep your abuse at a sensible level. If you don’t, the result can be anything from crime and violence to civil disobedience and revolution.

  • SteveV

    For those who hold up Egypt as an example of Democracy in action, I suggest this is but the first chapter in a book that has yet to be written. Predicting the future of the Middle East is not a safe bet. Perhaps what we are “seeing” does not reflect the reality of the situation but rather what we want it to be. I often wonder if, given the nature of man, societies are capable of maintaining a “democracy” for any protracted period of time.

    • Yar

      Democracy is an idea that only has meaning when it is in action.
      Democracy is not an efficient form of governance. Its efficiency comes from stability. Stable forms of government don’t have the high costs of revolution added every so often, the cost of compromise is appreciated (appreciation or depreciation depending on your point of view) throughout. I contend we all (except the oligarchs) want the same thing. We want to live safe place, to provide an education for our kids, and not starve when we can no longer work ourselves.
      Yes overthrowing a dictator in Egypt was the easy part, not blindly following the next ‘savior’ is the next and much more difficult task. Democracy requires self examination. It is worth spending an hour or two on public radio ever so often.
      I will support that.

  • Zeno

    True capitalism functions upon a set of rules and regulations drafted from a functional republic or democracy with the aim to benefit all of its citizens with ascribed goals of its constitution.

    We have neither of these.

    We have a corporate plutocracy, and thus the system is now self corrupting, and doomed to failure. Neither can be corrected individually without incurring the wrath and opposition of those who benefit from the corruption.

    All underlying regulations and rules are either ignored or created to the benefit of the top ten percent of the population by perverting government regulation and rules of commerce. No game can be played without rules that apply EQUALLY to ALL the players. If ten percent of the players in a game of monopoly are permitted to cheat…which players are guaranteed to win?

    The penultimate example in real life being INVESTMENT BANKING. This is capitalism at its most corrupt, and has benefited via massive government and social re-engineering. (the rules have been changed to allow a certain percentage of the population to cheat)

    Wall St via the IBs OWN the government through unregulated power of money and set the rules of a game in which only the plutocracy can win.

    Money to obtain power. Power to protect money.

    Wrestling these two gorillas of corruption into compliance at the same time has NEVER been done throughout history without a revolution from the real power of a nation…its people.

    The reason that the words of “our representatives” rang so hollow and hypocritical toward the people of Egypt is that they know they occupy the same positions of power here as ex-president Hosni Mubarak and the military do there.

    Like in ancient Rome… They have come to believe that the Sun will not rise without, their vaulted presence.

  • NH Mark

    Modern capitalism has degenerated into computerized swing trading complimented by good old fashioned sweetheart deals. There is little real leadership and almost no vision in our economy. Instability is not good for any economic system but Republicans clamor for deregulation; deregulation which helped put us into this mess. Let Michelle Bachman answer how her party would address the fact that the volume of oil traded daily is up to 40 times that which is actually consumed and the impact that has on stability.

    When times get tough, the workers who invested years of their careers with their companies; the people, without whom there would be no satisfied customers and no corporate wealth, are the ones who get pink slips: Fired by executives who’s dreams of wealth derived from mergers, synergies, and efficiencies fell far short of reality.

    Driven by the imperative to maximize the interests of swing traders who may hold stake in the company for all of two or three seconds, these corporate execs lay off workers and outsource their jobs by the thousands, regardless of the consequences down stream: the fundamentals of good business be damned!

    Why is our economic system incestuously married to this madness? Workers pay the price of executives’ failures by loosing their life savings as they struggle to keep their homes. Their fate has been decided by wealthy executives who get huge bonuses and payoffs even when they ignore the road signs and drive the company straight into a ditch. These are The entitlements that threaten our economy like no other. This is what I call true obscenity.

  • Pancake in NC

    The subtext among the corporate minded here is: “Democracy has never worked and never will. I prefer the hierarchy and monetary authoritarianism of the corporate model. That’s what works for me psychologically and secures my material needs at the expense of those below me.” Unfortunately, even President Obama and Rob Reich are corporatists. They want to make this system work without disappointing the oligarchs.

    We admit our so-called democracy is procedural and managed (mostly by media), and that it is tending more toward unfairness year by year. What we fail to admit is that capitalism is a partial failure too. It will not meet human needs in a world of scarcity and it is not adequately adaptable or innovative. Corporate capitalism is like a fire that drafts all value upward and destroys productive potential among the majority. It makes opportunity scarce. Being “left of Lenin, even Robby Reich” I can see that the market is a community thing that works on a small scale but becomes a monster when it grows beyond community control. Laws favoring the corporate vehicle are only one symptom of illegitimate runaway wealth-power.

    We do have much in common with the “Egyptian street” but what stops us is the illusion that we have a little property and a path to more. Realize that law in this country is conditional and selectively enforced. Justice comes at a price, and if you are unable to pay you can’t have any. At this point we are an anomic population whose community integrities have been hollowed out by corporate profit-taking. Naturally our voting is hollow and meaningless because we can’t form the words or concepts to express our needs and wants. We have lost the chain of custody on citizenship. When they want our opinion they give it to us: T-party style.

    If you want to resist go to Albert Einstein Institute and download Gene Sharp’s book with 198 ways explained. I like the “reverse strike” and I’ve been trying it out around Belmont. I think I see results: hearts and minds.

  • Julie Rohwein from Concord, MA

    I feel a need to be nit-picky. “Deficit” is a shortfall of income over expenditure for a given period, usually a year when discussing the federal budget. “Debt” is the accumulated total money owed. The deficit in the budget proposed by Obama is not $13T (that amount exceeds the entirety of the proposed budget, $3.7T for fy2012). The estimated deficit in this budget is $1.1T. Still a very large number, but not $13T. $13T is the amount Republicans are saying twill be added to the DEBT over 10 years by Obama’s budget and it’s trajectory. I will add that Rep. Ryan, whatever his other faults, does appear to have gotten the terms in the right order.

  • Marc

    What I worry about is that the economic disaster caused by all this debt will not be seen til it’s too late. So, the conservatives will continue to have their wars, the liberals their unions and all of a sudden we wake up and it’s a 50% inflation rate. I’m with Winston in that both sides have painted us into a corner. Each side has made the other side seem so despicable that we wouldn’t vote for the other guy no matter how crass our side is. Would a liberal vote against Frank even though he’s on the take more than just about any other politician. Same thing for conservatives and their team.

    • geffe

      If we did not have unions we would have no workers rights whatsoever. Are you aware that unless you are in a union you can be fired for anything, and I mean anything. Such as wearing the wrong color sweater. If you don’t think it’s true have a chat with Attorney General’s office on labor relations. I did and in the state of Massachusetts unless you belong to a union you are employee at will. Unions have problems and have some issues, but I would rather be in one than not. I’m not in one by the way.

      The unions are not what’s wrong here, it’s the military spending and the wars. Then Medicaid and Medicare are in trouble but that’s because we do not have a national health care system.

      • Cory

        Aah the joys of being an “at will” employee. This of course means we can fire you “at will”.

  • Yar

    I am drowning trying to eat the whole elephant of what capitalism is. Please break down a simple transaction: for example my daughter needed her tonsils out. Sounds simple, I had a decision to make, do the operation or not. How do I weigh the cost/benefit. The hospital won’t give me a quote on the operation, I don’t have a choice of hospitals without finding a different doctor, I can’t get any commitment from anyone that the surgery will be safe and without risk of injury or death. Oh, and I needed to make the decision immediately, because my daughter has tonsillitis.
    All of the people that think this is a free market choice, are living in fantasy land.
    Free market solutions don’t work for situations without true choice. That is why we pay for Government. How do we return to the place where government works for us?

  • KathyB

    I’ll know we’re willing to really make compromises when Democrats suggest cutting Medicare and Social Security and Republicans propose raising taxes. It’s only when politicians go against the grain of their own parties that anything really gets done in this country…e.g. Clinton and welfare reform, George H.W. Bush raising taxes and giving us “Clinton’s surplus.”

  • Loring Palmer

    Lor from Somerville: Ask your honored guests if it’s possible to come up with a way of doing business that does not produce serious pathologies. Because now we have a system that cranks up avarice, aggression, jealousy, narcisissim, and ignorance. Far example, “the manufacture of consent”–buy because you want it rather than whether you need it.

    • Zeno

      There is one corporation that bucks the trend of greed and exploitation…and it right here in the US, and operating very successfully. Newman’s Own.

      Conservatives have no explanation for its success.

    • Zeno

      There is one corporation that bucks the trend of greed and exploitation…and it right here in the US, and operating very successfully. Newman’s Own.

      Conservatives have no explanation for its success.

  • KathyB

    Regarding my previous comment – that’s why we need more politicians like President Obama and Senator Scott Brown – both willing to piss off their own parties.

  • Pancake in NC

    Yar
    When it comes to “eating the elephant of capitalism” I think vegetarianism is a good choice. Aren’t you a little old to have a daughter needing toncilectomy? Maybe hernia surgery would have been a more apropos example. I can’t believe deniers like Marc think busted unions are a problem. American unions are rare and crushed. Maybe the very idea frightens him. I do know that labor unions are the first line of activity in deposing dictatorship, as in Egypt, and that unions are the first counterrevolutionary target of their cartel owning army. It is OK for billionaires to conspire but thugs have to be called to separate scheming mothers at the backyard fence. Debt would not be a problem if our oligarch creditors were more understanding, forgiving and a useful part of community. Who in Hell does the USA citizenry owe money to? Most of our national debt is secured internally, and the rest is held by the interlocking global corporate oligarchy. If they kill the duck: No more duck eggs. I think our credit is still good, but we should not use it. Let’s try stone soup power. All wealth comes from labor. Anything contrary is a lie.

    • Yar

      It is a real example, yes, it was about 4 years ago, and she was in college at the time. I didn’t have good health insurance coverage, and needed to know if I was going to lose the farm over a simple surgery.
      As for unions, one of the strongest union today is the Chamber of Commerce.
      If business leaders need a union, you can bet the workers need them as well.
      Inflation is a tax on accumulation of paper wealth. If we target say, ten percent inflation annual, we are in essence saying use it or lose it. That is much better than holding inflation in a pressure cooker until it explodes. Which it will, all deficit spending is inflationary. If you build something of value with the money the purchase then pays for itself through its use.
      The discussion should be around how we spend our resources, not should we invest in our society.

  • Pancake in NC

    Yar
    When it comes to “eating the elephant of capitalism” I think vegetarianism is a good choice. Aren’t you a little old to have a daughter needing toncilectomy? Maybe hernia surgery would have been a more apropos example. I can’t believe deniers like Marc think busted unions are a problem. American unions are rare and crushed. Maybe the very idea frightens him. I do know that labor unions are the first line of activity in deposing dictatorship, as in Egypt, and that unions are the first counterrevolutionary target of their cartel owning army. It is OK for billionaires to conspire but thugs have to be called to separate scheming mothers at the backyard fence. Debt would not be a problem if our oligarch creditors were more understanding, forgiving and a useful part of community. Who in Hell does the USA citizenry owe money to? Most of our national debt is secured internally, and the rest is held by the interlocking global corporate oligarchy. If they kill the duck: No more duck eggs. I think our credit is still good, but we should not use it. Let’s try stone soup power. All wealth comes from labor. Anything contrary is a lie.

  • Anonymous

    I think we need to get our terms straight here. “Democracy” is what we intend for this country but we don’t really have it. That’s due in large part to turning out governance over to others while we tune out and don’t vote. Many who do vote are under-informed (that’s the polite way of putting it!). And let’s not even raise the ugly specter of “Citizens United.” So, no. Not really a democracy.

    When we talk about taking democracy into other countries — well, certainly when Republicans talk about it — we’re really talking about making those countries part of the capitalist system, part of the “free trade” system. That’s very different from democracy. America doesn’tt really embrace democracy for our “trading partners” or people with whom we have military accords anymore than we embrace it at home. Working democracies (like some in Europe) are dismissed as “socialist,” particularly when they’re praised for their high levels of social justice and fair labor policies. In the same way, the US form of capitalism has become debased and is really “corporatism,” a system in which labor is demonized and “capitalism” a cover for destructive greed.

    We’ve lapsed into a day-to-day acceptance of language which has been distorted for political purposes. So let’s be wary of how the terms “democracy” and “capitalism” are used. First we need to reinstate them before we speak of America as either “democratic” or “capitalist.” Let’s also put “socialism” back where it belongs. During some of our most successful times in this country, our economic and political systems ran smoothly as a mix of capitalism and socialism. Finally, let’s be clear about what we’re trying to do to other countries when we talk about encouraging “democracy.” The teetering confusion we saw in Washington during the run-up to Mubarak’s departure was exactly the kind of behavior we see in people who have told a series of lies and are having to move very carefully as a result!

  • Dave in CT

    More technocratic central planning, please!!!

    We have had it with all this cutesy freedom and liberty nonsense.

    Why must we fool ourselves that individuals, acting in their own economic interest for what/when to buy/save, will create an honest market that reflects the needs, values and desires of the population (vote with your pocketbook). Can we just be honest and admit we are too dumb for that? We need well-intentioned experts, who know so much more about the world, and what is best for us in the long run, to figure out how we should behave, and then let them take us there, through regulation, support of the “right” businesses, and media propaganda. We don’t want to live in a world that is not predestined. That is too scary. We don’t know where freedom will take us. Please, give us the answers so we can follow!

    Can we just embrace the China model once and for all already???

    Thank you.

    • Cory

      There is a tidbit of wisdom in your sarcasm. We should all admit to a bit of dumb-ness and a heaping helping of selfishness. I’m interested in all people on earth having a quality life, that is one worth living with food, shelter, and medicine. If “freeom” means millions or billions living like animals, then perhaps I’m not all that impressed with it.

      • Dave in CT

        Thanks for the reply Cory, but seriously, think about your response. You really think that? That there is clearly a better way to achieve what you hope for? That your, or my, solution of achieving it should be enforced upon everyone? That scarcity isn’t a real phenomenon?

        Obviously most of us share your personal views about selfishness, people be a-sh—s, etc etc, and wishing the world was easier.

        But just because we wish things were different, we can’t just will them into existence.

        Live your values, vote with your pocketbook, discuss with your friends and family, demand accountability, and by all means always scream about corrupted and collusive powers.

        But IMO, there is no magic bullet solution to creating plenty in this world. Its all about work, choices, and helping those we choose to help. Once we buy into a static utopian dream of an ultimate solution, I fear we lose our dynamism, our chance for innovation, not to mention our liberty to try and do better.

        You need perfect rules for a perfectly controlled system. I don’t think its possible, or desirable.

        • Cory

          Do you ever get the feeling that somehow we are capable of better? Do we let the horses and cattle stampede throught he streets, trampling the villagers? Do we instead manage them with harness, tack, and plow to do work and make our lives better.

          Dynamism and innovation cannot be stopped-they walk hand in hand with humanity. With that understanding I suggest we don’t need to worship these principles, or feel the need to protect them. Don’t get trapped in the “unlimited growth” paradigm.

    • Gerald Fnord

      Please don’t use the term ‘vote’; in a democracy, one person has one vote, but you’re describing a situation in which individuals have widely—I mean nine orders of magnitude—varying power.

      You might be surprised to ‘hear’ that I consider some of this power legitimate—people actually _do_ create new wealth for themselves by benefitting society at large, and to some extent they do so by their own efforts. But a good deal of it is inherited or scammed, and in any event its existence is as a “Creature of Society”, and as such owes something thereto. And, in any event, a belief in basic human dignity requires me to believe that no matter how much power you’ve got, certain decisions should be beyond you—for example, to even slightly impoverish our common possessions in air and water without compensation—and that no matter how powerless you are, you should be able to live and have some hope of bettering your condition.

      And, finally (apologies for prolixity) to say that it’s either some notional, McKinley-era, model of capitalism or else China’s current such is to create a false dichotomy…I will point out that there is now evidently less social mobility here than in any other Western nation beside the U.K….that socialism’s some deadly stuff, the least bit of it an one is suddenly unfree.

    • http://reinventing-america.blogspot.com/ ulTRAX

      I might as well repost this response since Dave is claiming the same things here as elsewhere.

      Dave naively spouts his pro-market 101 dogma claiming that consumers have the power to vote with the dollars and modify the most egregious behavior of organized and powerful corporations.
      While in pure theory that’s true, in reality it’s not.

      A perfect example is how difficult it is to protect our privacy on the web. Even the privacy conscious, web-savvy surfers have a difficult time keeping up with the intrusions and tracking. So how do the less savvy, less technical, internet users stand a chance? Just when they learn how to delete cookies we find out our browsers can be fingerprinted and sites can steal our browsing histories. What would Dave’s suggestion be then? That the problem isn’t with the websites that track and steal info from us…. but the internet users are at fault for not protecting themselves?

      Corporations always have the advantage in the market because they are well funded, organized, and single minded while consumers are disorganized and have more to do in life than investigate every single product looking for the latest corporate outrage. But in Dave’s world, corporations are blameless and all the responsibility for making them behave falls on consumers.

  • Jay

    Robert Reich, as Secretary of Labor, was a rabid supporter of N.A.F.T.A. which has led to massive U.S. de-industrialization and job loss and has turned Mexico into a narco-terrorist state. In the opinions of many, Reich has zero credidbility in regards to job creation.

    • Cory

      So having been wrong about something once permanently invalidates all of your future ideas? Pretty harsh… I know I’ve been wrong many times during my life.

  • ulTRAX… western MA

    I’m hoping the following topic is addressed.

    Capitalism is dynamic but grossly inefficient. We’ve become blinded thinking that PRICE competition proves the opposite. We never think in terms of how efficient an entire sector of the economy is. For instance is there any more INEFFICIENT way to create a videogame console than the way we do. We make three incompatible consoles all with their individual design teams, production facilities, distribution systems and retail shelf space. Software companies have to create 3 versions of games raising those same costs… and some blockbuster titles are exclusive to one console to lure buyers into that proprietary system.
    Would it not would be more efficient for all parties… including consumers if all companies involved in videogame consoles got together, and put all their best ideas into one product… and shared royalties?

    How have we grown to believe paying MORE for proprietary systems… which ALL may be inferior to a single system that contained the best industry ideas… provides consumers the best product at the best price?

    • Dave in CT

      You really don’t believe in the basic concept of competition between producers and freedom of choice by consumers as being the most efficient driver of innovation, while also preventing monopoly?

      Otherwise you have build layer on layer on layer of omniscient regulation and supervision to be sure your 1 benevolent company is doing and making the right things.

      IMO, you couldn’t ask for a better example of markets working for the consumer (I remember Atari).

      Also, I think its clear our greater economy, especially finance, that we do NOT have these kinds of competitive markets that reward quality and punish mediocrity or worse.

      • ulTRAX

        Dave wrote: “You really don’t believe in the basic concept of competition between producers and freedom of choice by consumers as being the most efficient driver of innovation, while also preventing monopoly?”

        Perhaps you enjoy the economic model that constantly rips off all of us for proprietary printer cartridges. I don’t.

        There are two basic models here for product development. One is competing proprietary systems… an approach that arguably produces inferior products that don’t contain the best ideas of industry, and raises costs to all… and where huge amounts of industry and consumer investments will be lost to dead end systems.

        The second is where there is COOPERATION between companies. This can be driven by government as in the case of broadcast systems. But it also can be driven by INDUSTRY not wanting to repeat the VHS vs Beta disaster. This doesn’t lead to monopoly for there is still competition between companies.

        Case in point. Industry got together to develop the first consumer digital video standard called DV. It contained the BEST ideas into ONE standard and the companies sorted out royalties depending on their contributions. The same happened with the development of DVDs and this common standard made DVDs one of the fastest adopted new technologies out there. Why? BECAUSE IT WAS A SINGLE STANDARD. There was no goddamn format war like VHS vs Beta or HD-DVD vs Blu-Ray. Industry, content providers, and consumers could invest in the standard with confidence.

        BTW… after the DV video consumer standard was developed, both Sony and Panasonic developed professional variants that were, of course, incompatible… designed ONLY to trap professionals into a proprietary system.

        You might see that as dynamic. I see it as one of the great pathologies of capitalism.

        • Worried for the country (MA)

          “Perhaps you enjoy the economic model that constantly rips off all of us for proprietary printer cartridges. I don’t. ”

          No thanks.

          First there are plenty of choices in printers. If there was not profit motive, there would be no investment in new, better, products. In your world we’d still be using dot matrix printers but you could use the same ribbon in all of them.

          • http://reinventing-america.blogspot.com/ ulTRAX

            Oops… I think I pressed the LIKE button on your post by mistake.

            I certainly don’t LIKE your red herring argument that if companies COOPERATE to pool their best idea there would be no innovation. The DV and DVD examples PROVE you wrong. These examples were NOT government initiatives… this cooperation CAME FROM INDUSTRY. We also saw what happened with AM Stereo where letting the market decide KILLED that innovation.

            So your red herring that we’d still be using dot matrix is ridiculous in the extreme.

            Innovation can’t be stopped but it can be directed. For instance VHS vs Beta. Beta had a better picture quality and VHS longer run time. NEITHER contained the BEST ideas from the JVS and Sony design teams. Both were INCOMPATIBLE. Having two systems RAISED overall costs of production and retail costs. Some large section of the population going to LOSE their investments… perhaps billions of dollars, in a dead end system. Knowing a videotape standard WOULD be developed, how did this wastefully competitive economic model benefit society as opposed to the DV or DVD model? It didn’t. In hindsight we all would have been better off with ONE standard that had the BEST ideas from Sony and JVC. THIS would have cuts costs, offered comsumers the most flexibility, protected consumer investments in hardware and video purchases.

            You are obviously BLIND to the common standards all around us and how they make the economy MORE efficient and REDUCE costs. There is no need for new competing proprietary brands of electricity, electrical outlets, or plumbing standards… connections for our stereos or TV. I could go on but I doubt you’d get it.

          • ulTRAX

            Worried wrote: “If there was not profit motive, there would be no investment in new, better, products. In your world we’d still be using dot matrix printers but you could use the same ribbon in all of them.”

            That almost sound like an insightful argument but you’re just regurgitating the standard apologetics for the most dysfunctional aspects of capitalism.

            All too much “innovation” is NOT designed to improve products or foster competition. It’s designed to TRAP consumers in private monopolies… proprietary systems… WHERE WE ALL PAY MORE.
            There’s not much new in faucet water filters that they require non-standard designs. One or two basic types would suffice… and then like with TVs or Radios, the companies could compete WITHIN THOSE STANDARDS.

            Read the book The 800 Million Dollar Pill some day… it’s how Astra Zeneca moved from a cash cow drug called Prilosec that was coming off patent to Nexium. Arguably Nexium was no better… in fact chemically it’s the same as Prilosec. But it offered new patent protection… and with a few hundred million in ads pushing it to doctors and consumers… it became the new cash cow. No real innovation… just a pure rip-off of consumers and insurance companies… raising health care prices for all.

            The notion that companies want to compete in an open market is naïve. They will if they have to, but they’d much rather milk consumers as cash cows trapped in proprietary monopolies.

        • Dave in CT

          “Perhaps you enjoy the economic model that constantly rips off all of us for proprietary printer cartridges. I don’t. ”

          I would say, go ahead and invent us an alternative. And then when the corrupt barriers to entry enabled by our collusive government/big business system, you can rally against the lack of Liberty you are suffering, as you try to bring something better to the ostensibly free market.

          If companies think cooperating with others, for single standards etc, is better for society, or better for their business over the long term, fine, they are free to do it. But there is no reason to prevent another company from trying to develop a different alternative that they believe, and may well be, better.

          Alot of this stuff IS rocket science, and only heavily educated and invested people will try to innovate. To think we could have a central commission looking over inventors’ shoulders guiding/enforcing the “best” way, I believe is not very realistic.

          • ulTRAX

            A seeming expert in Red Herrings Dave wrote: “To think we could have a central commission looking over inventors’ shoulders guiding/enforcing the “best” way, I believe is not very realistic.”

            It was in developing the NTSC TV standard… and Reagan’s market approach to AM Stereo failed miserably.

            But you really seem unable to grasp the simple point that at times THE PRIVATE SECTOR HAS COOPERATED ON STANDARDS. I gave you examples but your ideological blinders interfere with your ability to understand them.

            And let’s also be clear… corporations are CREATURES OF THE STATE. We The People give corporations certain rights and benefits… like limited liability protection… and We The People can call some of the shots on how they operate. We once made them operate in the public interest and if they didn’t We The People routinely exercised the corporate death sentence of revoking charters.

            We DON’T need a government central commission to do anything. We can rewrite tax laws and corporate charters to CHANGE THE INCENTIVES BY WHICH THESE COMPANIES OPERATE.

            Getting this yet Dave?

            Didn’t think so.

          • Dave in CT

            “And let’s also be clear… corporations are CREATURES OF THE STATE. We The People give corporations certain rights and benefits… like limited liability protection… and We The People can call some of the shots on how they operate. We once made them operate in the public interest and if they didn’t We The People routinely exercised the corporate death sentence of revoking charters.

            We DON’T need a government central commission to do anything. We can rewrite tax laws and corporate charters to CHANGE THE INCENTIVES BY WHICH THESE COMPANIES OPERATE.”

            That all sounds pretty good. I’m not against any of that. And I apologize if the Central Commission thing wasn’t applicable to what you were saying.

            I just think when it comes to “calling the shots” it should be in regards to them breaking laws, or engaging in corrupt or collusive behavior, not deciding whether they should cooperate or what they should make.

            Yes there are/will be inefficiencies as you have explained, but real inefficiencies will be punished by the market, unless of course the market is rigged to keep the inefficient stuff going, and preventing new competitors from displacing them.

            I agree with you to the extent that WE are the state, and thus WE grant corporations things and should be able to revoke such things. I don’t agree with the idea that Corporations are individuals and should be treated as such.

            I do think small and individual business are creatures of free individuals, and should be relatively free, but that when you move to the corporate level, as you say we should be free set certain limits that are punishable by revocation or law.

            None of this to me is incompatible with the stuff I have been talking about.

          • http://reinventing-america.blogspot.com/ ulTRAX

            Dave wrote:
            “Yes there are/will be inefficiencies as you have explained, but real inefficiencies will be punished by the market, unless of course the market is rigged to keep the inefficient stuff going, and preventing new competitors from displacing them.”

            You clearly still don’t understand what inefficiencies I’m speaking of. That’s to be expected since we’re brought up to believe capitalism is inherently efficient… just as we’re brought up to believe we have a government that reflects the will of the people. They are both myths, albeit firmly established doctrines.

            First inefficiency in the capitalist markets is NOT punished. Companies that are inefficient might be forced to restructure or go out of business.

            But there is the broader definition of efficiency and that is how well an entire industrial SECTOR is able to produce the best product at the best price. I would again argue that there is perhaps no more INEFFICIENT way to produce most of what we own than the way we do it.

            Ask yourself this: how do we most efficiently produce the best autos at the best price and are the cheapest to maintain. If we ask THAT question we get a ENTIRELY DIFFERENT ANSWER than if we ask how can COMPANIES make money making autos?

            We don’t see the gross sector wide inefficiencies because we never ask that first question but wear ideological blinders and focus on apparent price competition which provides the illusion companies are driving prices down. We never calculate the HIDDEN OVERHEAD for the duplication of design, production, distribution, promotion, ownership maintenance all built into having so many proprietary auto designs. What is the cost to the economy of producing INFERIOR autos that are unsafe and expensive to maintain? The notion that the market will weed them out is the most INEFFICIENT way to perform this function.

            And what about standardization. Could we standardize chassis and engine design so perhaps the entire world’s auto fleet could use just 8 or 10 designs as opposed to 75 or 100? Companies could then tack on their signature bodies and interiors. Think of the savings in production and maintenance.

            Yet if we never ask such questions we’ll never be able to tame capitalism. For instance if we eliminate these grotesque industrial inefficiencies could we have the same standard of living on a 30 hour workweek?

          • Dave in CT

            I do understand your argument, I just don’t clearly hear your solution? One company, or outfit, working to solve a problem based on need and the best science and tech sounds great. I am just not convinced that isn’t very similar to the state controlling the means of production, which sounds rational, but for whatever reasons, likely human failures to keep thinking out of the box if not required, group-think, creeping loss of sense of urgency etc, has not worked over the long run historically.

            Yes competition duplicates efforts toward the same goal, but it puts a fire beneath them to do it better and faster, so long as the winners are rewarded and the losers regroup. Of course its a bit cutthroat, but there is no reasons companies and the ideas they are based on cant develop and thrive and grow, and then die and compost, over and over in different permutations of skill, technology and labor. If that process is allowed to occur organically, their should be enough shifting employment to keep most of us working, even if we have to change outfits.

            When we fear that kind of dynamism, and instead try to replace it with some sort of static plan, I think real world experience shows that we get stagnation.

            I don’t believe the economic inefficiency theory of multiple competing outfits is necessarily true.

            However, that said, IF we decide we don’t value faster progress, greater innovation etc, at the expense of more static comfort, than we can choose to actively inhibit competitive practices, and the number of players in an industry, so we are not challenged by the dynamic nature of that.

            But that is a choice we have to make. It sounds a bit like communism to me. The argument can be made.

          • Dave in CT

            As a scientist, I often thought that what you are saying makes more sense, that there is a “right” most rational way to do things, so why don’t we just do it! But even if that is true, its easier said than done to get there. So its a question of what practices get us there. Even in science, those “best ways” and realities are discovered not just by individuals, but by the whole process and community of science that IS intellectually competitive, and uses peer review to winnow down the best understandings.

            But its a whole community of competing thinkers and labs. One lab at NIH could never figure it all out as fast and as thoroughly as our whole nation of public and private research labs.

    • ulTRAX

      BTW, such cooperation isn’t rocket science. This is the way the old NTSC TV standard was developed. The National Television Standards Committee had top experts from government and industry. The common standard insured that broadcasters could make an investment in equipment knowing consumers would be able to receive their signal and consumers to make an investment.

      Contrast that to developing an AM Stereo radio standard back in the Reagan era. The approach then was to let the market competition do its magic. Of course it then all fell apart. Few broadcasters were willing to invest not knowing consumers would be able to receive their signal and consumers… in these days of VHS vs Beta, were also unwilling to make an investment in a system that might fail in the market… making their investment worthless… then having to pay again to buy into the market winner.

      AM radio’s failure to improve its signal quality and go stereo meant it could not compete with FM. Arguably, this is why AM became the bastion of news, talk, and sports.

  • Dave in CT

    Is Private Enterprise Predatory?
    http://mises.org/daily/449

    “I read your column posted on Mises.org entitled “Economists and Antitrust.” While your argument is sound in appearance, I would like for you to give me a brief explanation of how a privately/publicly held business, using the power of its superior economic resources, would not become monopolistic and destroy the competitive atmosphere of a free enterprise market.”…………

  • Craig from Omaha

    We need to learn from the example of a more humane capitalism in Germany. First, there is a sense of cooperation between business owners and workers, as they realize that they are in the same boat as their workers represented by labor unions and/or workers councils. Secondly, there is a different cultural attitude — a realization of long-term planning rather treating the business a cash cow to be milked. Today the German economy is booming — the country has a trade surplus and a lower unemployment rate than the USA. That country’s business and political leaders see opportunities for growth and development in green energy and fuel efficiency whereas many in the GOP and capitalists like the Koch brothers dispute the scientific facts such as human activity is impacting global climate AND the world is either at or nearing a plateau of peak petrolium production — the “drill, baby drill” falacy that North America can produce its way to energy self-sufficiency AND maintain our current level of gasoline & diesel fuel consumption.
    In 1855, an astute German visitor to the United States (Johann Georg Kohl from Bremen) criticized the speculative spirit of American capitalism and the tendancy to cut corners and risk safety in the building of our railroads & river steamboats & Great Lakes passenger steamers throughout his extensive travel narative through the Midwestern States (Reisen in Nordwesten der Vereinigten Staaten). These tendancies persist.

    • geffe

      In Germany lobbying is illegal. Corporations are not people and they don’t have a First Amendment.

      I agree with you about there model. The Germans have strong unions and are doing very well. They have decent vacation time.

      We don’t have vacation anymore in this country, we have two weeks, but that’s not enough. People need more time to rest. Have a life. In this country it’s all about being busy or at least seeming to be. We work longer hours and are less productive.

      • Sam Wilson

        We are nothing but “mechanical parts” in the “machine” that can be easily replaced, so as to “produce”. Hence US workers are the “most productive” in the world.

      • Krazzycat

        A perfect example here is BMW. I have seen reports on how they have re-engineered their production lines in Germany to accommodate their aging workforce. This has led to higher productivity and fewer errors. Here in SC, BMW is doing away with the aging workforce and replacing them with “temporary” workers. Hence, no benefits need to be paid. That is the American way.

        • Craig from Omaha

          BMW has hired “temporary workers” in Germany also. They also have a significant apprentice training program, and people from both groups are encouraged to apply for perminent (ie union manufacturing jobs) as they become available through retirements. Several years ago, BMW opted to created a major new manufacturing plant in Leipzig (former East Germany) rather than a lower cost location in the Czech Republic or Slovakia. Regarding their North Americn works near Spartenburg, SC – that plant has increased in size and production three or four times since it has opened. BMW, like many German manufacturing companies, is very good at developing markets for its high-end products. Forty years ago, BMW manufactured fewer than 15,000 cars for North American export (I bought one of them & still have it), but now they compete in volume with Cadillac, Mercedes-Benz and Lexus for the luxury/performance market in this country — and with a product line that is “more luxurious” and less diverse (fewer diesel engine options, no four cylinder models, smaller proportion of manual transmission cars) than for their European markets.

    • Slack

      Germany also has job sharing built in to its employment structure so downsizing companies to not jettison employees. Instead, employees reduce their hours and part of that loss in wages is paid for out of the unemployment insurance pool. That way the employees stay connected to the workplace and to each other. Massachusetts has a small voluntary pilot program based on this model. It needs to be expanded to the whole country.

  • William

    There is no better economic system than capitalism. It has uplifted more people than any other system in the history of mankind.

    • Sam Wilson

      Do you recall anything about East India Company? If not, I will highly recommend to read a bit about it.

      • William

        A private company from England which had a place in history at that time.

        • Sam Wilson

          Exactly.. but what it ended up doing in Indian Sub-Continent, remember that as well?

    • Cory

      How about coming up with a new “ism” then?

      • Dave in CT

        Cory, please come up with one. Socialism or Communism and all manner of benevolent dictator schemes seem not to have worked historically.

        Giving people as much freedom as possible to achieve better things, while not perfect, is the best we have seen!

        Its all expectations. Do we wish the world, the universe was “fairer”? Of course. Do we resent scarcity? sure. Do we wish we weren’t animals in a world limited by the laws of thermodynamics? you bet. But that’s our reality.

        The argument against Utopian Central Planning is that as attractive as it is, IT HASN’T WORKED HISTORICALLY, and usually ends in despotism and worse conditions for the masses.

        Throw criminals in jail- blue collar, white collar, government, and demand accountability to those who corrupt and collude in our businesses and government.

        IMO the problem is we have ZERO ACCOUNTABILITY any more for elite criminals. Yes the little guys always go to jail, but the real consequential crimes go unpunished.

        Don’t blame freedom or competitive markets, blame criminals and colluders and THROW THEM IN JAIL FOR ONCE.

        Our main problem is we are prostrate at the feel of the elite, who we believe are our saviors, and we refuse to hold them accountable.

        Unless you are an elite, corrupt planner or corporatist, WE ARE ALL ON THE SAME SIDE!

        • Zeno

          “… Yes the little guys always go to jail, but the real consequential crimes go unpunished.”

          Actually the plutocrats make even more money putting the little guys in jail through the socially funded incarceration industry.

          • ThresherK

            For-profit prisons? Why, it’s like someone here knows what “free market” “populist” groundswell was behind Arizona’s “Vere are your paperz?” law

          • Slack

            Indeed, as you know, the Arizona immigration bill was written by a for-profit prison company because they know the next big move in detention will be immigrant detention.

        • Cory

          I agree with much of what you’ve just said, except the bit about scarcity. There is enough capacity for food production on Earth to feed everyone (quite easily). The problem is human institutions that buy/sell/horde/waste the products and capacity.

          Here is my incomplete “ism”. You’ve been born… welcome to the club called humanity. For all the days you live you shall have food, shelter, water, and medicine. ANYTHING beyond this is up to you. Work hard and earn more, work harder and earn even more.

          It is an incomplete “ism” because I’m not entirely sure how to get there. I do know this though, the resources exist to provide my forementioned “humanity club” garauntee and still allow those motivated to produce and earn so much more. I’m not smart enough to work out all the details, but I have the conviction that we are capable of so much better than we are doing now.

          • Dave in CT

            Not a bad model. Certainly not what we have now, either on the side of providing the basic, or on the side of fair-free markets uncorrupted by collusion on the other side.

            Of course the challenge is setting limits to health care costs, as with todays technology, you could go on and on trying to prolong your life, test for disease etc, and I think those costs are an overwhelming part of our economy.

            So then you have to address Rationing. Another hard thing is the slum concept.

            I am for Single Payer/Competitive Provider for Health Care, Infrastructure.

            Then, I believe in the most free, uncorrupted (backed by the Rule of Law) markets for the rest.

            Doesn’t seem that crazy.

        • Wm. James from Missouri

          Dave,

          You are correct when you say, “The argument against Utopian Central Planning is that as attractive as it is, IT HASN’T WORKED HISTORICALLY…”, however, I must add that it is in “theory” possible to create a Utopian type society

          On prior shows I have mentioned such great thinkers as, Kurt Godel, and Alan Turing. These are but two of the many great minds that have given mankind a glimmer of hope for such a society. Mathematics is a very difficult and opaque subject for so many, that it makes it hard to express the reasons why this is so. I will mention that many people are trying to solve various, heretofore, unsolved conjectures, such as the P versus NP problem. This one problem, if ever solved would go a long way toward increasing our ability as a species to “overcome” many problems we currently have. I recommend reading, Scott Jacobson’s article that has appeared in Scientific American Magazine some years ago.

          • Caleb from Somerville, MA

            To Wm. James from Missouri:

            What we are talking about here is:
            1) commonsense regulation – like getting the %$#@ out of NAFTA and imposing labor and environmental requirements on importers.
            2) basic protections – like min. wage, age limits to work, overtime pay, OSHA standards, unemp. ins., Soc. Sec. (those in the world’s civilized countries would include universal access to health care (which is WAY CHEAPER THAN A PRIVATIZED SYSTEM AND YIELDS BETTER RESULTS), and a quality education on that list).
            3) a sensible tax system to back up these protections: think Johnson-era code (or even Reagan-era code for that matter!) and an elimination of tax breaks and subsidies to multinationals.
            4) big cuts in defense spending – we spend over 7.6x the next highest spender, China, and over 4.0% of our GDP, which is more than 2x every other country on the Globe. It’s time for an end to the military-industrial complex.

            This is hardly the boogie man of “Utopian Central Planning”. Leave your silly scarecrows and Joseph Stalin effigies for the Tea Party misinformation celebration. Leave genuine discussion of sensible policies for the common good to people who can think past the veil of corporate wool that’s been pulled over their eyes.

          • Wm.James from Missouri

            You may have missed my point. I accept many of the things you have posted. I only wish to state that this is not the entire story.

  • Brandstad

    The US economy has been so monkeyed with by the federal government, it is anything but free market capitalism!

    • geffe

      Man you really need to get an education, please stop.

    • Cory

      What would be the end result of absolute deregulation of all markets?

      • Zeno

        China

      • Dave in CT

        Who argues for absolute deregulation?

        The Rule of Law, is based on………. a level playing field legal framework with legal consequences to certain behaviors (law).

  • BHA

    Absolutely we need to fix ‘capitalism’. Capitalism now means:
    GREED
    GRAFT
    ENTITLEMENT

  • Pancake in NC

    Dave
    China is corporatist. Corporatist is what we should be trying to undo. How do you undo a nation run by big business using the government to hold ‘em down while they screw ‘em ? You don’t do it with lax regulation. You don’t do it with media owned by a few corporations. You don’t do it with unlimited political contributions considered free speech. You don’t do it with representatives accountable only to lobbyists. You don’t do it with the central bank and the Congress handing out money to the wealthiest and then claiming the working people owe it as taxes. You don’t do it as long as corporations claim citizenship when making the rules and global mobility when the bill comes. Dave, I don’t think you want to change anything. You only want to scare people with noise while you dominate your wife and steal the pie. Change will not come from superior feeling little men complaining they didn’t get enough while trying to take the essentials from the disadvantaged. When change comes those men will be hiding under someone’s skirts. Fearful little men, this is a dirty job. If you don’t want to help, step back and be quiet.

    • Dave in CT

      We are moving quickly toward a China model. Freedom to consume, but the power elite unaccountable. I don’t really understand your post.

      The idea that the power and capital elite collude at the level of big government and big business is quite simple.

      The difficult problem is while one hopes big government would protect us galliantly, it too becomes corrupted. And the bigger, the more powerful, and more difficult to undo.

      I think people are very historically short-sighted, in thinking that tyranny and the inhumanity of centrally-controlled power, is just a fairy tale. Do you really think those things aren’t true?

  • Drpmeade

    Tom always enjoy listening to your show but capitalism as we know it is nearing its end. Business owns our country and most of the world. We are well on the way to destroying the earth as we now know it through climate change and little will matter after that. We are on the verge of economic collapse no matter what happens. I am afraid what your commentators have to say today will have little effect on what happens in the future. That has already been taken out of our hands by what has already been done.

    Enjoy the ride.

  • Erin in Cedar Rapids, IA

    Capitalism is code for “Calvinism” – proving you are “worthy”.

  • Ernie

    What on earth would inspire me to have confidence in business? This is from someone who once believed that the Chicago School was sacred and incontrovertible doctrine.

  • Alan

    Ask your guests why it’s okay to outlaw products made by underpaid workers in sweatshop conditions in this country but it’s okay to import those products from countries where those practices are not outlawed.

    Alan Shulman, NH shulmandesign.net

  • bbbartel

    Companies aren’t people, but are given the same rights.

    If they are people, they are sociopaths that look out for their own (narrow) interests and externalize all costs on the public sphere.

    Corporations, if they are to survive in the US as it currently exists, must act as a sociopath. They must pass through costs to the public when they can; we clean up toxic waste dumps, we clean up after a mine is closed down.

    Any “eco-friendliness” comes from responses to costs and not to a sense of responsibility.

    Get off oil/coal/gas? Increase the cost of it by adding a tax to it (i.e. stop subsidizing it) and what happens? Use will decrease.

    Want to reduce the amount wasted in packaging? Force the companies to take it back and they will immediately change it. Why? To reduce their costs and increase their profits.

    • ThresherK

      More rights, actually.

      If I kill or rob a person I go to jail. Corporations get limited liability.

      Felons don’t get to vote, felonious corporations get “made” on K-Street, like organized crime figures.

  • Philonous

    But isn’t it true that our society is too complex for small businesses to address these questions without the assistance and guidance of government? By the same token, multinational corporations are so large as to be diffuse.

    It’s the job of business to make money and the job of society to order itself and set the conditions under which business can operate.

    Greg Camp
    Springdale, AR
    http://gregorycamp.wordpress.com/

  • Richard Gagnon01

    The problem is not capitalism but, the malignant cancer it has spawned called “Corporatism”. Capitalists create wealth. Corporatists game the system by moving money around and skimming off the top but, create no wealth.

    Corporatists have no loyalty to the U.S.A. they are internationalists who are more than happy to open a factory in China regardless of the affect it has on America and Americans.

  • Grady Lee Howard

    The Borg on Star Trek II wasn’t an analogy of socialism. It was corporatism embodied. Think about Cheney’s plastic heart.

    • Cory

      Resistance is futile… Your biological, technological and economic distinctiveness will be added to our own…

  • Brett

    Revolution’s just another word for nothing left to lose…

  • john in danvers

    I’m a hedge funder. And I am disgusted by what I see. I mean, sure I want to make money, but I don’t want to torpedo my neighbors doing it.

    There are only two things i see to fix this, and both involve government:

    1) We must tariff imports to adjust their low wage labor content up to US prevailing levels.

    2) States are negligent not to review their incorporations for public benefit. Those charters that may not be beneficial to the public should be cancelled.

    Absent these, there is no hope.

  • http://www.facebook.com/people/Peter-Lake/100000246324434 Peter Lake

    Reich endorses only the biggest business of all: government.

  • geffe

    If CEO’s make more than 100 times or more than the lowest paid worker something is wrong with the system. I don’t hear this being addressed.

    • geffe

      I’m being conservative most CEO’s make more like 200 to 300 times the lowest paid worker in this country. This was not the case 40 or 50 years ago.

  • BHA

    Business will lead us to a better future when:
    The CEO’s and execs have RISK for their reward. There is NO risk now, only reward:
    - Company does well, you get millions (if not tens of millions) of dollars in salary, bonus, retirement.
    - Company does poorly, you still get millions in salary, maybe no bonus and millions in your golden parachute as they show you the door.

    - When we stop hearing “They have to be paid millions per year or they won’t take the job”
    - When the people running the company recognize that THEY personally do NOT bring a hundred times as much benefit to the company, nor work 100 times as hard as the people who actually produce the products the company makes.
    - When the people running the businesses realize that the important time frame is not next month, not next quarter, not next year but 5, 10 15 years down the road.
    - When CEOs and execs get fired instead of getting bonuses for sending existing jobs to low cost countries or for selling the company in a merger where many employees lose their jobs but the execs get bonuses for ‘doing a good job’.

  • Eric M. Jones

    Tom, I smell sulfurous vapour. You guest has no soul and has turned into an apologist for Wall Street bankers.

  • dave

    Every one should read Porter’s “An Economic Strategy for Americas Inner Cities” I think we have to examine the goals our public policy has set for capitalism. Since 1934 we have put most of the incentives to invest in single family homes and four lane highways. We have not adequately put the incentives for the markets to invest in factories and inner cities. I believe business can deliver what we ask it to deliver, but we have been asking for all of the wrong things.

  • Philonous

    I don’t need businesses to offer me “good” choices. I want them simply to offer choices and be honest about them. I’ll make my own decisions. The honest part of that, of course, is the point at which government regulation comes in.

    Greg Camp
    Springdale, AR
    http://gregorycamp.wordpress.com/

    • ThresherK

      Yep, with you as also Robert Reich: Don’t pretend that corporations are about anything besides greed.

      The corollary: Corporations can get to be all about greed once they stop the for-crap touchy-feely issue ads, stop whining about taxes and regulations that would have been beyond the wildest dreams of the old boys network at any point since WWII, and stop treating subsidies as a birthright.

      • Brandstad

        ThresherK, you are correct that corporations strive for profits and the owners of corporations is the US public in the form of 401K and roth retirement accounts as well as pensions and other fixed income investments. If the corporations do not make profits, grandma doesn’t eat or pay the utility bills.

        Profits are GOOD

        • ThresherK

          Yes, profits are good.

          The difference between “striving for profit” and me robbing you at gunpoint (I’m profiting!) is lost on some people.

  • Harold

    federal tax policy can remove or discourage the short-term shareholder value thinking by INCREASING the short-term capital gains tax.

  • Grady Lee Howard

    Philonous Camp
    Ordering all society to fit the needs of business sounds fascist to me.
    I guess they do it like that in Arkansas. That wooded park orten to be a papermill, make it so!

    • Philonous

      I meant that the people of the society have to order it–that’s not fascism; that’s democracy. And no, we don’t do chew our forests into paper here.

      Greg Camp
      Springdale, AR
      http://gregorycamp.wordpress.com/

  • Ira B.

    3 big contributors…..
    1) Shareholder value is not measured by the investment community. Share values are assessed vi a p/e ratio…..price/earnings……Shareholder vlaue is not easily measured or understood.
    2) The “compact” with employees has been broken. Employees and execs are ‘rented’ for a short time. Compensation is therefore short time oriented and the result is obvious. Further, most execs can assume that they will not be at the compnay when the problems hit the fan.
    The incentive for long term view is nonexistent.
    3) Board of Directors are not able to understand and really direct and control large corporations. Board control is one of the biggest fictions in business.

  • Pancake in NC

    Dave
    Capitalism gives no freedom.
    It gives scarcity, environmental degradation and dominance by the wealthy.
    Imagining “Farmville” will not cut it.
    If people like me started to seize freedom you would panic to think I had more freedom than you.
    Some people depend on a Boss. I don’t.

    • Brandstad

      Without Capitalism there is NO personal freedom!

      • Cory

        None? Like zero? Like I can’t have hot cereal instead of cold or part my hair on the left instead of the right today?

        “Only a Sith deals in absolutes.” -Obi Wan Kenobi

    • Dave in CT

      “Capitalism gives no freedom.
      It gives scarcity”

      What? Scarcity comes first. Then we have to deal with it. Are you a self-sufficient homesteader? If so, awesome, I love the idea. But its hard, and most can’t do it, and specialize in something and trade that skill.

      Freedom to innovate and work to solve scarcity problems is the best humanity has done.

      There is no secret stockpile of food and goods that we all deserve and can be handed out to us by a fair government.

      We have to work.

      You can either work freely and try to trade you skills/product, or you can be told what to do, reducing your productivity because you resent it, or just aren’t good at it, and thus reducing our overall productivity vs scarcity.

  • Pdeli

    Business is better suited to confront the challenges of our society than a big, slow moving entity like our Government.

    Porter is correct, and this movement isn’t on the horizon – it’s occuring right now. Just Google “Patagonia”, “Trader Joe’s” , or “Zappos” to name a few…

    • ThresherK

      Zappos, Trader Joes, and Patagonia are going to save the Gulf from BP, “Grandma Millie” from Enron, and Bhopal from Union Carbide?

      • Pdeli

        No one is arguing that firms taking a stakeholder approach are in the majority. What I (with the support of societal, generational, and demographic trends) am arguing is that this approach will become the dominant one, and society as a whole will benefit as a result.

        BP, Enron, and Massey Energy are writing the eulogy for the funeral of the shareholder approach.

  • Steve L

    I have used the argument that regulation frees companies to compete on a “level playing field”. If companies are prevented, by regulation, from cutting corners (social, environmental, ethical, etc.) then those companies can compete using their ability to succeed within the rules.

    I also believe that, so long as companies are run based on quarterly stock prices, they will not run the companies for the best interest of the company, let alone the good of society.

    Michael’s vision is one I see in my fantasy of a perfect world.

    steve in nashville

    • Jon Tepper

      Here, here! Michael Porter’s vision can also be moved forward by more responsible behavior on the part of investors: if shareholders need to be more vocal in their demand that companies be more socially responsible. Amy Domini, founder of Domini Social Investments, has been a pioneer in the arena of socially responsible investing.

  • Waterwebb

    The only thing that flies against self-interest today is regulation. The capitalists who believe in their mantra will leave social responsibility to others. The world will migrate toward what it perceives as its survival.
    Saving money is not social responsibility. Spreading the wealth to those who have contributed value is social responsibility.

  • Waterwebb

    The only thing that flies against self-interest today is regulation. The capitalists who believe in their mantra will leave social responsibility to others. The world will migrate toward what it perceives as its survival.
    Saving money is not social responsibility. Spreading the wealth to those who have contributed value is social responsibility.

  • Gerald Fnord

    All I want to know is: once it becomes technically feasible for our all living well without working—coming sooner than you might think—will our social technology lag so behind that we’ll be stuck with this stupid, scarcity-based, hierarchical bullstuff?

    Some people really enjoy being a lot richer than everyone else; worse people enjoy the fact that some of us are poor, and love to make up stories about why their own wealth and the others’ poverty are justified by some god—Yahweh and The Market are popular choices—and to them universal greater (never complete) happiness is a _threat_.

  • Gerald Fnord

    All I want to know is: once it becomes technically feasible for our all living well without working—coming sooner than you might think—will our social technology lag so behind that we’ll be stuck with this stupid, scarcity-based, hierarchical bullstuff?

    Some people really enjoy being a lot richer than everyone else; worse people enjoy the fact that some of us are poor, and love to make up stories about why their own wealth and the others’ poverty are justified by some god—Yahweh and The Market are popular choices—and to them universal greater (never complete) happiness is a _threat_.

  • William

    It seems odd the one caller complained that labor “is not getting their fair share” after the disaster in the American auto industry. The UAW “got their fair share” for the last 30 years and GM went bankrupt.

    • Caleb from Somerville, MA

      To typical William re: UAW and GE.

      1. Please demonstrate that the UAW caused GM to go bankrupt and not poor management and trade agreements that set any decently paying company on a lower competitive foot (you’d have to demonstrate that before these agreements were passed, the company was already sinking). Was their declining market share and poor financial standing not due to:

      A) Institutional lethargy in management, which favored boxy gas guzzlers instead of the more popular compact models that Japanese and European automakers were pursuing relentlessly? Remember, engineers and designers have never been unionized at GM – why did management not decide to shift their clunky product line to match the shift in consumer preference? (maybe inside deals with oil?)

      B) What about the fact that, because of terrible regulations & enforcement in Mexico and even worse trade agreements, you can pay an auto assembly line worker $7/hr, versus $13 an hour in the US (that’s the wage level that the very few organized plants in the US agreed to last year), while skirting every kind of environmental protection imaginable?

      2. Do you realize that American manufacturing, exports as a % of GDP, etc. was GROWING at a startling pace during the 1945-1973 period while union density was FALLING? Every single year since 1953, union density has been declining by about .7-2% each year, up to the present day. If Unions killed manufacturing, how is this fact possible?

      What is more likely, is that the changing trade agreements in the late 70s and early 80s with Japan began to kill our auto manufacturing sector – partly because they were undercutting us with low waged workers, and partly because they were designing and selling compact cars with much better fuel economy than our American brands. Esp. after the oil crisis of 73 and the rise of the environmentalist movement in the 1970s, consumers could only find decent compacts from Japan. The trend only began to accelerate, across many other, non-auto manufacturing industries in the 1980s, when the Reagan goon squad when around Latin America overthrowing populist regimes and creating zero tax “free trade” export zones, targeted at the US. Notwithstanding, U.S. Manufacturing – in almost every sector – began to decline at at an alarming pace, post-NAFTA and post-normalization of trade relations with China.

      3. Why throw out the baby with the bathwater? I personally believe that – during the era of big labor – seniority clauses and clauses that make it very difficult to fire employees for bad performance, were actually encumbrances to labor’s broader struggle. If the FEW remaining strong unions today, for example, got rid of their seniority clauses, but held on to their fight for fair (not excessive) wages and health benefits, would that not be a valid and worthy exercise of collective bargaining rights?

      • geffe

        I agree 100% with your points. It is now a well known fact that it was mismanagement and not the unions that hurt GM.
        The big issues for the auto industry is health care. If we had a good single payer system as our competitors do in Germany and Japan as well as Korea, this would not be an issue for the auto makers.

  • BHA

    New tax structure:
    Day trading and short selling – losses are lost, not deducted from gains.
    Gains are taxed at 95%

    And the robo trades – Computers that buy and sell thousands of shares on a penny change in a stock’s price. Make it illegal or tax at 105%.

    After hours trading. Get rid of it. If you are buying stock when the market is ‘closed’ it is NOT closed. Those buying are doing so taking advantage of changes ‘regular’ people have no access to.

    NONE of these things support business or the real economy. Investments should be money INVESTED, not quick flip money. Buying a share of stock from someone does NOT support the company and is NOT a value add to the economy. Why do the traders get paid hundreds of thousands of dollars a year plus the ‘mandatory’ bonus? They are doing nothing more difficult than a job with the phrase “Do you want fries with that?”

  • Chgraham

    Every consumer decision has an alternative. If you find a certain firm’s products or model objectional, don’t buy their stuff! There are plenty of firms across industries who behave in a value-oriented, responsible manner. If that carries a premium so be it…..

  • Harold

    I don’t disagree with maximizing shareholder value over the long-term. Short-term shareholder value seeking is destructive, and we can look at how the US economy has radically changed for the worse since the capital gains tax cut of the 1980′s. Let us increase short-term capital gains taxes up to the 50% level — that will change the thinking in the boardroom.

  • Agnostic

    Dr. Porter does not seem to be proposing anything new to me. In any rational free market if the costs of producing in China is more than locally, the market will in its own interest adjust that. What is he actually proposing that is new?

  • Info

    The only reason a for-profit corporation exists, its only goal, is to make profit. Do good? Maybe, if it helps improve the bottom line. To expect anything else shows ignorance of a fundamental aspect of our society.

  • geffe

    The last two callers hit the nail on the head.
    We need living wages, good health care, decent time off.
    The idea of working in this country now is pretty awful.
    Over 10% of the nations work force has been laid off.
    In the age group over 45 the number is higher.

    About wages, my sister was laid off due to a sale of the compnay she worked for. She found another job doing the same thing but had to take a huge cut in salary. She does not see anything wrong with this, however I do. the attitude is she is lucky to have the job. That’s not how I think we should look at work. She works over 50 hours a week for 40K a year.
    Her percentage of what she pays in health care went up. This kind of thing is happening all over the country.

    The corporate world is sitting on trillions and not hiring and if they do they are doing so with salaries that are lower and with less benefits.

    The doing well by doing good is a pipe dream, a nice one, but a dream.

  • Karl von Stirner-Hayek

    Does capitalism need to be ‘fixed’ as:
    0.) …a repairer fixes a machine?
    1.) …the Mob fixes an horse-race?
    2.) …professional wrestling fixes itself?, or
    3.) …a vet fixes a cat?

  • Nathan Morton

    Corporations by definition can only respond to their shareholder’s interests. This is why every corporation wants to externalize costs to taxpayers (dump waste in a river so taxpayers have to pay for clean-up, build a new mall – see if the stay will pay for the roads to funnel mall goers) I have no interest in what a corporation thinks best for a community through charity- instead they should lose their extensive tax breaks so that democratically controlled state and federal governments can decide where that money goes and regulate them in the citizens’ interest.

  • Thebobm

    It is time to change the 18th century Value paradigm for publicly traded companies. Investors need to take control back from tilted Wall Street analysts who place value on the wrong corporate attributes.

    Valued companies now are the ones that lay-off 1,500 workers in January but come in cents above target for their quarterly report. Not valued is the company that keeps 1,500 workers and falls pennies short of its target. Any company that has kept workers and made any profit in the last 24 months is a good company that deserves investors’ dollars. A True American company invests in R&D, employee 401(k)s, healthcare plans for their employees, and keeps jobs in the USA at the cost of making profits dictated by Wall Street.
    -BobM
    Bloomington, IL

  • margaret, NE

    Corporate went on the cheap because the US became a disposable society with cheap products.
    Now with the crash of American business and the decrease in Americans employed causing a greater work stress on those employed income is no longer going to be spent on disposable products.
    Americans now will be looking for products that are well made and that will last.
    American capitalism just adjust to society and social demand.
    Those who do not meet the public needs of today will loose.

  • Dean

    Oh, Brave New World that has such corporations in it! Doing good for their workers, their neighbors, their communities, their planet….

    Problem is, that brave new world is not the world of capitalism.

    Companies are realizing that making things in China is not cost effective, and are rethinking this policy? So which ones are moving back to the US? Can you name them, so we can recalibrate our world views?

    I can name a local solar energy company that took huge subsidies from the Commonwealth of Massachusetts to build its works in this state, made grand promises to do the right thing for America, and just moved to China, anyway, because it is in the interest of the only entity that matters to a capitalist.

    • Wm. James from Missouri

      They should be charged with racketeering.

  • Antegigs

    Capitalism isn’t a “thing” … it’s people. When the people in charge respect the dignity of the human being, then capitalism is good. When the people in charge have only self-serving hearts, then capitalism is evil.

  • Dan Marshall

    Moderation of All can be somewhat closer to a better form of Equality in the economy. RESPONSIBILITY OF ALL from SuperRich to the Poorest and the Lowest of Us all,and Proper and Fair Rules must be inforced and regulated with Gusto………….dm

  • NH Mark

    It’s more of a Kleptocracy than a putocracy.

  • Dave in CT

    Mr Reich is making the Libertarian argument, that business and government collude and destroy the real, competitive market.

    • labored

      Mr. Reich, former Secretary of Labor, is making the argument that is wholly consistent with the creation of labor unions and the American labor movement. They alone had the power to stand up to large employers and get them to increase pay as productivity increased…creating broadly shared wealth…allowing average, every-day workers a shot at the American dream by merely givign a full day’s work for a FULL DAY’S PAY. Those days of the unwritten social compact between labor and management Reich points out are OVER. We need the labor movement to come back bigger than ever to help once again help grow the middle class.

  • Jonathan Vaage

    I’d like to see more more “For Charity Companies.” Perhaps charitable groups can replace shareholders in their role in financing. I would prefer to support companies and products that are designed to generate proceeds for charitable causes.

  • Bob Reardon

    I support the concept of “Free Enterprise”, but I always as “free for who?” It seems that defines the problem and is the big question.

  • Wt from Nashville

    Please ask Mr. Porter if he has sources of income outside of Harvard U., and what they may be.

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  • Kathlleene1013

    Corporations have taken jobs out of America, employing low wages, long hours these people then organize and they move their company to the next 3 rd world country.
    China didn’t follow the the same course.

    Big business should be afraid.
    They rape the people, and environment.
    They buy governments.
    People our fed up. Look at the rioting around the world.

    We know that Corporations rule the global world, and they have no respect for workers, environment.
    They respect profit at any cost.

  • BHA

    Mr. Reich’s current comments are RIGHT ON.

    More money is spent trying to circumvent regulation than working to provide safe products produced in a safe environment by people that are paid a reasonable wage and are safe for the customer and environment.

  • Lorentzenb

    WE NEED a new LABEL just like the nutritional labels that tells the consumer how the product is manufactured, what they are doing to take back there junk…etc. It is the only way to do it. consumers need to make the change

  • Greg Camp

    One concern here is the idea of companies, owned and run by a limited number, deciding what “doing good” means. I prefer to have society as a whole, through the democratic processes.

    Greg Camp
    Springdale, AR
    http://gregorycamp.wordpress.com/

  • Jean Mcgavin

    Michael Porter sounds as though he has just discovered fire. For years the press, the people, have been screaming that business function as he is now preaching. Where has he been? Business has driven the global economy into the dirt. How have businesses been so deaf dumb and blind and as they have been, and how can he expect the rest of us to have any faith in this type of mega-capitalism to reign itself in? Unbelievable!

  • Kyle

    what about the fact that companies do not act in their own long term interests. They act in the interests of the people who run them, and plan to retire. To many people in charge of the companies are trying to get out with money before the company ruins its own future

    • Dean

      Great point, Kyle. The formula of profit at all costs has evolved into a quantum leap of focus that even damages the next unfortunate person to hold the reins!

  • Anonymous

    Don’t we have more of a political problem than a capitalist problem? Just look. We favor big oil, we bail out big banks, we don’t have the political enact strict and sensible environmental laws. We distort the market by giving big breaks to homeowners. We have rich lobbiest who hold more sway than an individual voter. And finally, we hire industry insiders as advisors and treasurers.

    Capitalism has it’s problems, it is true, but the bigger problem to me is a political one.

    • ThresherK

      You sound as if you think capitalism and the political issues exist in two separate vacuums.

      Robert Reich nailed it when he said that so much of today’s “regulation” is the result of one set of corporate lobbyists tilting at another.

      • Jon Tepper

        Here, Here! After studying regulatory economics at MIT Sloan School, I understand that regulation is often a ‘product’ that is sold to the highest bidder in the lobbyist marketplace. So, regulation ‘for the benefit of the people faces’ 2 great challenges: 1) Corporations spend hundreds of millions of dollars to lobby Congress and regulatory agencies to influence what regulation gets enacted into law, the details of agency rulemaking, and how the regs. will be enforced, and 2) Corporations work hard to circumvent whatever regulations do manage to run the gauntlet of corporate resistance noted in 1) above.
        Jon Tepper
        Newton, MA

        • labored

          “The problem in America is not that the top 100 corporation presidents are violating the laws, though God knows they are: the problem is they’re writing the laws.” Nicholas Johnson, Federal Communication Commissioner 1972

    • Dave in CT

      Exactamundo.

      IMHO its because our populous has become so politically/philosophically lethargic, that we are now AFRAID of liberty ideas/politics, and are almost tripping over ourselves looking to the corrupt Republicans and Democrats who have rigged the system into State Capitalism, NOT a competitive free market, to save us.

      If we are to lazy to revisit our founding principles and realizing the good and important parts of them, lets at least vote

      Ron Paul/Ralph Nader 2012 and let them have a chance and not the 2-headed monster again.

    • Dean

      I agree with ThresherK: When has capitalism ever not sought control over politics? In our economic system, money is power, and it will find avenues to exercise that power wherever they exist.

      • Dave in CT

        We have to always be vigilant and always fight it. There is no free lunch, even for Americans. Why we think Democrats and Republicans are going to give us one is beyond me.

        • Dave in CT

          Should we get rid of the sun because it can cause sunburn and droughts? No, we accept its harsh reality and protect ourselves accordingly. IMO same goes for government and business. But only in a culture that respects, keeps alive and internalizes the individual and liberty, can we keep our sense of vigilance against both of them as necessary.

          Once we are hoodwinked into handing over too much power to government or capital, we are in trouble. As we are.

    • Scott B, Jamestown, NY

      Once reason Wall St is doing so well is that they know that they will be bailed out again. Meanwhile, not one law was changed, not one major player in that debacle has gone to jail.

      • Dave in CT

        I still hope Tom & Co. do an hour on ACCOUNTABILITY, or more specifically the lack of it in our society, particulary against elites.

        Iraq, Katrina, Financial Blow up. We all know there were players and decisions and ignoring existing laws or the Constitution that contributed to these things.

        Seen any heads roll? Any? A one?

        Madoff? What a great thing he was for the captains of Wall St and friends in the Clinton/Bush/Obama economic teams.

  • Philonous

    Do we really want the kind of world in which our bosses pester us to lose pounds and cholesterol points that they know we have? Who will watch the watchers?

    Greg Camp
    Springdale, AR
    http://gregorycamp.wordpress.com/

    • Gerald Fnord

      It amazes me that we Americans will accept intrusions into their privacy and diminutions of their dignity from private sources that we will not from the government.

      I understand that the government can use force majeur to compel us, but the threat of losing your job can be in some circumstances more a threat than that of being sent to prison. I understand that many such we endure are contractual and so nominally voluntary, but
      1.) Some rights should be inalienable—that means they can’t be taken away, and also that you can’t sell them or give them away, and any contract which claims to effect such an alientation is invalid, and
      2.) If to survive in a societ you must agree to your choice of any number of contracts—all of which infringe—your choice isn’t really ‘voluntary’. You think the Most Holy Market will prevent such, as there’s always a scrappy upstart who will offer you better terms? In the absence of Evil Big Gummint interference, there’s no law against collusion to squash such, and non-{homo economus}, actual persons, seem to like acting like that.

  • Zeno

    Michael Porter is a deluded child who believes the world he wants is the real world. If he keeps telling himself the lies that he is spouting today he will be ripe for Scientology. Yikes what an idiot.

  • Drpmeade

    Why does this remind me of the old saying “whistling through the graveyard”? Michael Porter seems either clueless or a corporate shill. Too little too late as far as I am concerned or blowing smoke to fool the masses. The corporate world will never take claim to the damage they have done to the extent they need to.

    Tom grill Michael Porter some more. You seem to have him squirming a little.

  • Brandstad

    Progressives are Evil!

    Study the early american Progressives of 1890-1930 and you will see this.

    • Cory

      I’m a progressive. Am I evil? Do I have to tell my little girls that their Daddy is evil?

      • geffe

        Yeah Cory you have to break it your kids that you are the devils messenger. According to the likes of Barnstad folks like us who have different view points are evil instead of being disagreeable.

        I don’t think conservatives are evil. I don’t agree with their world view. I do think some ultra right wing folks might be.

    • Scott Bi, Jamestown, NY

      You mean the progressives that got Americans a 40 hour work week, kids out of mills, rat feces, formaldehyde, and body parts out of food, expanded the middle class, advanced science and eduction…?

    • Nogojo

      Idiot!

  • John

    Businesses only have themselves to blame if they are viewed as pariahs. Businesses will make none of these changes unless they are forced to.

  • Jon Tepper

    Most of Prof. Porter’s examples are cos. doing good in ways that have short-term positive impacts on their bottom line. Example: what WalMart is doing in their sustainability program. This is all good, but it is not sufficient. Ask Micahel Porter how to encourage corporate behavior that is socially responsible but may have a negative short-term effect on the bottom line!

  • Philonous

    To Brandstad,

    I’d add that freedom is limited whenever any entity gets too big and too powerful. That curtails the power of the rest of us.

    Greg Camp
    Springdale, AR
    http://gregorycamp.wordpress.com/

    • Brandstad

      I agree.

      That is why we have anti monopoly laws that shouldn’t be ignored. The banks that got bailed out were too big to fail and too big to exist on their own, so they should have been broken up into smaller more manageable banks.

      • Philonous

        That’s the idea. Many so-called capitalists today cite Adam Smith, but Smith argued for small business. Multinational corporations, then and now, were hand in hand with government, while the local business whose owner you knew could be dealt with as an equal.

        • Robert Hennecke

          My economics teacher at Mcgill failed me (by one %). I had argued that I had doubted very much that Adam Smith would be a latter day proponent of slavery. I am referring to what one finds in the locked down Foxconn facillity whereby none other than Apple sub contracts it’s work. Fifteen or more workers on the Apple line have committed suicide as it is too hard on the 13 year olds to work 16 hours on their feet straight. I say that even our educational system is corrupted with false assumptions of what makes a society healthy and just like equity funds, professors punish you if you don’t toe the line and buy into the over-riding narrative that the corporate model is great and everyone benefits by off-shoring to repressive regimes. heaven forbid for those companies that off-shore to countries like the Pr China if what happened in Egypt spreads to there. The Egypt revolt was really about throwing off a corrupt corpocracy that was aided and abetted by global corporations.

  • Caleb from Somerville, MA

    Let’s get Mr. Porter to cite case examples and back it up with statistics to show that the whole-scale outsourcing of production is slowing down. ** PLEASE BACK UP YOUR ARGUMENT WITH FACTS **. In 1970, about 77% of our toys were made in the US. In 2010, over 77% of our toys are made in China. NAFTA impoverishes – 1 Million production jobs lost since 1993, farmer cooperatives in Mexico disbanded and converted into low wage plantations; states and provinces sued for enforcing any environmental regulation that cuts profits; Most-favored nation status with China impoverishes; the S. Korea trade agreement will impoverish. Obama said he would renegotiate NAFTA to include labor and environmental protections: this has not and will not happen – the memo regarding his correspondence with the CHCGO prove that he giving labor lip service. The Henry Fords who pursue efficiency wages and realize they have to build a consumer base with such wages if their product will succeed are mavericks as rare as Gandhi.

    These three compete: wages, profit and prices. The goal of almost every business is to maximize (mostly short term) profit by pushing wages as low as possible (while retaining some basic level of productivity), and to drive prices as high as possible without decreasing revenues. Labor’s struggle is to raise wages and protections while keeping prices steady – this means lowering margins. This basic conflict of interest cannot be avoided through intellectual obfuscation.

    Let Mr. Porter cite figures to show that outsourcing and the downward spiral, global wage arbitrage it creates (Ricardo’s Iron Law), is abetting or reversing. As long as our labor laws are in place – the FLSA, the NLRA, the Soc. Sec. act, OSHA, etc. – this seems extremely unlikely. I’d be fascinated to learn about this surprising trend.

  • http://www.stopcorporateabuse.org TJ Faircloth

    The vision that Michael Porter sets forth that paints big business as a potential force for good seems hopelessly optimistic or misguided when you consider the political influence of transnational corporations. It appears that Mr. Porter fails to calculate the current power of transnational corporations, which allows them to externalize social costs with little recourse. Corporations now have the power to thwart public interest policies by interfering in the political process that aims to protect people and the environment. And even when governments regulate in the public interest to rein in corporate abuse, corporations have the ability to export their abuses into “expansion markets.” The argument that corporate marketing and other corporate activities can be utilized for public good is dangerous because this is often a fundamental argument for voluntary or self-regulation by corporations. There are inherent limitations to self-regulation and they most often only serve corporate PR interests. Transnational corporations will continue to build power in the relentless effort to deliver short-term profits at any cost. Until the power of transnational corporations is checked by the democratic institutions empowered to regulate them, then it is not logical to buy into the myth that one day corporations will act for the good of people and the environment.

  • nat dur

    You talk as if business, labor and community had the same interest. In fact the interest are in conflict and the ongoing struggle–in the form of politics and regulation–should be strengthened, not weakened.

  • geffe

    Mr. Porter is so misguided. Does he really think this will work?
    It’s pie in the sky. Look at what just happened the gulf last year with BP.

  • Scott B, Jamestown, NY

    I got cut off after being put on hold by Tom, but that’s ok, he’s a busy guy. At least I got to say my little piece.

    The story I didn’t get to relate about my wife’s work was that the laid off over 200 people in what came down to a move to break the union. The union wasn’t asking for gold-plated anything, just working wages. Everybody knew the economy was tanking. The VP of the union became so flustered at the company negotiators that she looked at the company VP and said, “When the last time you had to worry about paying bills? This company made tens-of-millions of dollar in profit last year. How much money do you need?!”

    So the company laid off almost 300 workers and moved the machinery to another location for 2 years. The problem was that some contracts require the parts be made in a union shop, and the machinery was sent to a non-union shop. Fast forward 2 years – The company has to fill those contracts and bring the machines back. The company get’s a big write-up in the paper about how its fortunes are turning around and they’re re-hiring laid off workers. Yes, they re-hired FIVE. FIVE! When the workers were laid off they were making $10 – $12 @ hour. When they were re-hired they were hired at $8.20, the same rate new hires were getting. The company denied the union’s request to get the re-hiresat at least the rate they were making when they left, since the union had caved before the layoff so returning workers weren’t able to be re-hired with the raises they would have been entitled to during their layoffs.

    And that’s the crux of it. There seems to be this sense of entitlement by CEO’s and toward the stockholders. CEO’s make well over 200x what their average workers, and I don’t see the sacrifice. Once I did hear Ken Lay’s wife say that they had to sell one of their houses in Aspen. Oh, boo hoo!

    The President of JAL, Haruka Nishimatsu, gets it. He’s suffered right along with his workers, enormous taking pay cuts so his workers still had jobs.

    Without the workers to buy products and services in this country, there is no economy. But companies want to make more profit with less, and that usually means less people, and less wages.

    • Scott B, Jamestown, NY

      I got cut off after being put on hold by Tom, but that’s ok, he’s a busy guy. At least I got to say my little piece.

      The story I wanted to relate about my wife’s work was that the company laid off over 200 people in what came down to a move to eviscerate the union. They couldn’t break the union because some of the contracts require that the parts be made by a union shop. The union wasn’t asking for gold-plated anything, just real cost of living increase. Everybody at the table knew the economy was ailing. The VP of the union became so flustered and disgusted at the at the company negotiators’ attitudes that she looked at the company’s V,P and the other company people, and said, “When is the last time you had to worry about paying bills? Or putting food on your table? This company made tens-of-millions of dollars in profit last year. How much f@$&%!g money do you need?!”

      So the company laid off almost 300 workers and moved the machinery to another location for 2 years. The problem was the machinery was sent to a non-union shop. Fast forward 2 years – The company starts getting orders again has to fill those contracts by union shops and bring the machines back. The company gets a huge write-up in the local paper about how its fortunes are turning around and they’re re-hiring laid off workers. Yes, they re-hired FIVE. FIVE! When the workers were laid off they were making $10 – $12 @ hour. When they were re-hired they it was at $8.20, the same rate new hires were getting. The company denied the union’s request to get the re-hires at at least the rate they were making when they left, or even $1@hr more, since the union had caved before the layoff so returning workers weren’t able to be re-hired with the raises they would have been entitled to during their layoffs.

      Now the company wonders why they can’t find decent help. Why should anyone bust their backs in factory work for little more than minimum wage when they can get better pay at McDonalds or Walmart for a lot easier work? There is one environmental bonus in that the workers can no longer afford to get their cars fixed right way when they break down, so lots of car pooling.

      There seems to be a sense of entitlement by CEO’s and toward the stockholders. CEO’s make well over 200x of their average workers, and I don’t see any sacrifice by them. Once I did hear Ken Lay’s wife say that they had to sell one of their houses in Aspen. Oh, boo hoo!

      The President of JAL, Haruka Nishimatsu, gets it. He’s suffered right along with his workers, taking enormous pay cuts, even going without pay, so his workers could still have jobs.

      • Scott B, Jamestown, NY

        Oops! Didn’t mean to post that twice.

    • labored

      Thanks for your call and story. Here’s the JAL video http://www.youtube.com/watch?v=858t44psmww

  • Jazzbirks

    Is Michael Porter’s position based on fact-based analysis or on faith?

  • AJ Averett

    Welcome to Modern America, where what passes for reality is filtered through Alice’s looking glass. Rather than business serving society through the citizen-consumer, we now live in the alternate universe where we citizens are merely individual ATMs feeding wealth to corporations at the expense of of our health, our environment and our future. And so, we have finally passed the point Lincoln so eloquently cautioned us about, and government of the people, by the people, for the people has in fact become government of, by and for the corporation. After all, they own the best politicians their money can buy, and are aided and abetted by a population not only largely ignorant of evidence-based reality, but resentful and antagonistic towards those who are not.

    • Robert Hennecke

      Right on !!!

    • Slice

      Slice
      Thanks AJ, you just described life in the Matrix.

  • Slack

    So long as you have to raise $30,000 a WEEK to run for national office, corporations will continue to own the government lock, stock and barrel. With all due respect to Mr. Reich, the 3,000 pound gorilla in the room is the way we finance campaigns in this country, which allows corporations to have the best government they can buy. Public financing of campaigns is the ONLY way to get the money out of the system. As anyone who has ever owned a dog, he who feeds the dog owns the dog. Right now, corporations are feeding the dog, hence they own it.

    • Dean

      Hear! Hear!

    • Dave in CT

      The Fix Congress First effort.

      http://www.fixcongressfirst.org/

    • labored

      Not to mention the SCOTUS United Citizen decision a year ago.

  • Valerinalotus

    Speechless……This is the very first voice i have heard that really gets our society…..thank you Michael for giving me hope.

  • http://www.facebook.com/profile.php?id=1408098372 Mari McAvenia

    The biggest problem with capitalism, as it is currently practiced in the USA, is that it is a totalitarian economic system. The power which has been amassed by corporations has been turned upon the people, like vicious attack dogs, to our collective degradation & social collapse.

    In a true democracy the market is a product of the people, designed to serve the needs of an entire population. In America today, the market is a creation of the few who hold heavy. We have no choice but to participate in it or die. How is this equivalent to the notion of “freedom” or even to a “free market” ?

    The so-called free market is not free for everyone. Most of us are prisoners held in thrall by a handful of liege-lords. I suggest that we find out who these lords are. They have all our names & numbers, let’s turn it around and get the the goods on them. Something like democracy just might follow when these greedy rats are flushed out of their subterranean nests and thrown into the glaring sunlight where we can finally see who they are and hold them to account. Revolution? Sure! If that what it takes to restore a sane balance between healthy communities and raw capital wealth.
    From Quincy, MA

    • Robert Hennecke

      I call it ‘petty dictatorships’. Mini banana republics that are run like mafia operations whereby race is a major issue. Companies prefer to hire races that tend to be more submissive and willing to endure abuse.

  • M Hyun

    Tom, I have to say that I am beginning to get very frustrated at your constant interruption of your guest speakers. Not only does it come across as rude, I feel that we do not get to hear the full extent of the speaker’s thoughts and ideas.

    This show could have been so much better and insightful if you only gave the speakers half the chance to speak.

    • ThresherK

      I was not frustrated at our host as you were.

      Actually, what goads me is someone with a pile of new ideas who spouts “Everybody in this debate is caught up in redistribution”, automatically taking the framing and the language of our corporate overlords.

      It was such a load that Tom Ashbrook was forced to rebuke it immediately, which was good to hear. And NPR needs more guests in the Rolodex like Robert Reich to slap that crap down.

      It’s already enough that our “mainstream media” is full of people like Charlie “$250k middle income” Gibson, and that there’s an entire wing of the media dedicated to telling ignorant voters that they’re poor because Social Security wasn’t put in the stock market in 2006 (or some other “free market” crap).

      NPR doesn’t need to swallow bilge of that sort unthinkingly.

      • Zeno

        Talking propagandists do not stop proselytizing on their own. They have to be interrupted or they would preach for the entire hour.

    • Scott B, Jamestown, NY

      The show has to move along, and you can’t have one person monopolizing the conversation.

      I managed to get in a call today and tried to make it as brief as possible. While I did type out the whole story on this board after the call, I knew during the that there was no way that I was going to get in all the information, and gave the Readers Digest version. But I’m also just a caller. Guests should get to speak longer, and I think Tom does a good job of letting them get their points in while keeping things on track and moving along.

      I watched Bill Maher the other night and he had Cornell West on. Now, I appreciate what Dr. Cornell has to say, but he was speaking on and on, very cadence-like, the way someone used to speaking in public for a living and having people pay attention to them tend to do, and he was not taking the hint that the other panelists were trying to add to the conversation. Bill should have taken better charge of the conversation. Think about it: When you’re discussing what’s happening in Egypt, don’t you want to listen to the guy that is from, and intimately knows, the Middle East (Hooman Majd in this case) , rather than the guy who (while he’s very smart) is basically just book smart on the subject?

      It kind of seems typically American to only want to listen to ourselves about others.

  • WT

    Because of the inherent implausibility of Mr. Porter’s arguments, demonstrated admirably by every single caller – I’m disappointed, for the first time, in Tom, for not asking for who Mr. Porter works, other than Harvard. I know it’s a slippery slope, and Porter would act shocked and offended, as if he were unquestionably above undue influence, but it’s time this question became usual, especially when business regulation and law is the topic.

  • Robert Hennecke

    There needs to be a third rail, temporary non profits that are worker owned so that they don’t get off-shored by trans national corporations. This is my point in my blog, corporate welfare iseffectively bribes with competing jurisdictions begging and pleading companies to locate here or there. The reality is they want the corporate welfare and hire people while they are susbsidiz…ed but then eject them once the gov’t runs out. It is self defeating. Building guilds and co-ops to produce things and owned by the members of it would at least remove the threat of off-shoring and relocation of these productive facilities. I am not saying outlaw the corporation, but the problem is the underlying philosophy of the corporate model is profit maximization and employment is a MEANS TO AN END, not the objective so if a corporation can achieve it’s objectives by off-shoring or employing no-one then so be it. There needs to be an entity that I call three year non-profit status for modernized guilds/co-ops provided they manufacture and are owned by the co-op members
    http://modernizedcraftguilds.blogspot.com/

  • Drpmeade

    The only thing that will change corporate mentality is either pitchforks and torches or a disaster of “Biblical” proportions. The latter may come before the former as I think the “masses” love what they get from the corporations. I truly feel sorry for may children.

    • Wm. James from Missouri

      A messianic Al Capone ?

  • Mail6384

    Well, that was an hour or arrant b.s. Mr. Porter sounds like so many other apologists for corporatism. He’d like us to believe corporate hegemons have seen the error of their ways and are ready to change: “we’ll self-regulate!” He shows his hand every time he wails about “redistribution” and how constrained and imposed upon our corporate class is. Here’s a tip: the only time you worry about a corporate titan is when he *stops* bitching about taxes and regulation. Evangelists of the “New Corporate Enlightenment” like Mr. Porter love to hold up anomalous examples of corporate responsibility (Patagonia, Ben & Jerry’s, whatever) and suggest this proves that some kind of tide has turned. Before you pat yourself on the back Mr. Porter, let me point out that for every one company like that, we can cite hundreds who chose instead to “redistribute” their costs to the American people in the form of externalities, and “redistribute” their profits to themselves.

    Not that it matters, but I’ll mention that I’m the owner of a small business and in no way a raging socialist or enemy of capitalism. I’m someone who believes the only sustainable future for our economy is for each of us to turn away from large corporations and patronize small, locally-owned business to the fullest extent possible.

  • Whopjob

    Let’s begin with the admission that political-economic systems do collapse. Proceeding, then, with the assumption that capitalism is sound and staple… would be a delusion.

  • Zeno

    I remember reading The Jungle by Upton Sinclair when I was in grade school. This book describes the Utopian world of capitalism that deregulation creates.

    I would bet that it is a book banned from most schools now.

    • http://www.facebook.com/profile.php?id=1408098372 Mari McAvenia

      The Jungle still resonates with me, too. Even though I read it (voluntarily) when I was still quite young, the message of the narrative stuck. Remember that Sinclair also wrote “Oil!”- nearly a century ago- which was the basis for the remarkable movie “There Will Be Blood”, released in 2008.
      We should all re-read Upton Sinclair’s polemic & prescient literary works and then confidently pass them on to our young. Better yet, we should encourage MORE new writing endeavors which embrace the style and forceful, compassionate humanity of Sinclair’s effective prose. Thanks for remembering the Jungle, Zeno.

      • Caleb from Somerville, MA

        Another, excellent and highly accessible set of populist inspired literature from the same era in American letters is Carl Sandburg’s “Chicago Poems”. They are public domain and freely available from multiple internet sites. Another book that complements The Jungle is Dreiser’s Sister Carrie. Chris Hedges seems to have aptly addressed the decline of an important progressive, masses-focused element to literary and high art establishment in his book “The Death of the Liberal Class”. We must remember that this element of protest literature and art was brewing in small corners since the 1780s but did not explode into the lecture space of established, tenured intellectuals, into the collections of museums, the contents of journals or major publishing houses, etc. until the early 20th century. The darker and activist sides of Romanticism were minority strands of the movement that were not absorbed into institutional voices until the Modernist period. Now, the critical and progressive Left is waning into obscurity – first and foremost in Politics, but secondarily in the Arts, Humanities and popular media. Even in the context of Mass Culture’s Reality TV, when’s the last time you saw a show about working class or poor people like the Jeffersons or Laverne and Shirley? There may be a return of a poetry, an art, dance and literature that again focuses on economic oppression and exploitation of the wage and factory system (think Immokalee, FL, Bangladesh, India, China, Vietnam, Cambodia, Honduras, Haiti, Guatemala, Nicaragua, Chile today). What museums feature exhibits that expose the reality that the great majority of our toys and clothes are now made by oppressed women and children slaving up to 16 hours a day, 7 days a week in dingy, noxious, poorly maintained factories for barely a pittance – while their American and Euro mgmt & shareholders abscond with billions, on top of tax subsidies?

        But we must always remember that the main venues of the establishment – which hold more than simple economic power, but also an encroaching monopoly on “verifiable,” “legitimate,” “researched” opinion – are funded by those whose interests are put at risk by such awakenings…Therefore, only when the financial and political basis of the noise and knowledge establishment shifts to a broader % of persons in the economic order, do we see anything representing the interests of that percentage come into the mainstream.

        Of course there are always marginal, “critical” voices that the establishment in a (fake) democratic society must maintain in some obscure op-ed column, so long as its powerful engines are dependent upon the illusion of consumer choice and self-determination. “Look! The press is free, our universities are free,” they say, “see, we employ a professor like Robert Reich, or Joseph Stiglitz; see there’s a column by Naomi Klein.” But these voices are the enforced exception, showcased occasionally as a PR proof of liberty, while real dissent to NAFTA and the Laissez Faire Supranational Capitalist Cabal is given 1/100 of the space that the boot-licking, mercenary intellectual prostitutes are — e.g. Jagdesh Bhagwati, David Brooks, Tom Friedman and sell-out, sham distorters of economic and historical reality, who do not engage the claims of the opposition seriously but only battle straw men, while pretending to support humanitarian causes, like Nicholas Kristof: may misfortune befall him.

        But what about when the lion’s share of consumption and the wealth of the main power brokers is no longer based on the broad base of the citizenry? For examples, one only need to turn an eye toward our less fortunate, totalitarian neighbors: Burma, Egypt, Jordan, Cambodia, Bangladesh and even much of India (whose “democracies,” as reflected in non-violent strikes in both countries that took place in 2010, include torture and imprisonment of most labor organizers by the state police), North Korea, etc. What happens is that the decisions of the authorities need only favor those upon whom their tenure depends.

        We have already, for the most part, arrived at such a state, though the consumerist liberty of the misinformed, apathetic zombie mass still maintains the idea that we have a representative government, that aligns its policies with the majority or even the overwhelming majority’s will. Why do you think we cut taxes for the wealthiest of the wealthy in the USA during the middle of a depression EQUAL IN SCOPE (look at Workforce Participation rate, not Unemployment which only measures those receiving Unemp. benefits) to the Great Depression, while signing a host of new job-killing, child labor-loving trade agreements, while scrapping the Public Option, and sinking major cuts into public education, social insurance and infrastructure maintenance spending, without reforming finance or credit regulation and while bailing out banks with no strings attached this past year – under a “Democrat,” no less?

        Now they are talking about lowering corporate taxes and cutting even more essential regulations from our already deregulated corporate plutocracy. We are fighting two full scale wars – one of which (Iraq) was entirely based on a pre-planned conspiracy and which proceeded despite 6 separate attempts at a Peace agreement and a full-scale declaration of its illegality by the UN – yet they are slashing revenue sources as fast as possible from those who are pocketing all of the wealth we produce. Not only that, but the Fed is boosting inflation with rock bottom interest rates and other quantitative easing practices in the name of trying to up liquidity, when study after study has shown that, even though banks and major corps are sitting on unprecedented mountains of cash, they are not lending and they are not hiring. Yet direct job creation – versus useless bailouts – via a revived WPA is not even up for debate. Retail prices continued to rise while per unit volumes dropped, even after oil prices drastically declined in 2008, because our market is overly consolidated and trust effects can and DO occur. In a free, competitive market, lower input factor costs should be reflected in lower prices: not so in the US! If it’s not abundantly clear, the entirety of the Republican Party and over 1/2 of the Democratic party has been fully bought by the Multinational business lobby. Think Council on Foreign Relations, the Tri-Lateral Commission, the US Chamber of Commerce, the CATO Institute, the WEF, the G7, G20, the WTO and the Bilderberg Group.

        There could come a time – which is already rearing its head in many of the President’s comments (let alone his CEO laden Economic teams – and every other cabinet member, with the exception of Hilda Solis) – when even the pretense of populist appeal can be foregone because 1) the wealth of the major players is no longer dependent upon large, mass market consumption and 2) there is no serious threat of uprising, because of an iron-clad surveillance system and police state. In 2007, after all, 27 GOP Senators (over half of the senate caucus), voted to **eliminate** Federal minimum wage altogether.

        During such times, the composers, poets, authors, filmmakers, dramatists, dancers, theorists, scholars of the common interest are pushed into the underground and their posterior memory either becomes a minor footnote or vanishes altogether. In the meantime, Sandburg – simple, unpretentious, ardent – can strike an inspiring chord.

        • Bruce from Boston

          You are so right, Caleb – so much of what passes for political discourse rises only to the level of comedy. And yet I still hear authentic intelligence in the more dispersed and less controlled media of the internet. Your very words are my first evidence. In respect to the police state, however, I have less interest in an ‘uprising,’ even given that political legitimation is secured by an uninformed and reflexive ideological consensus. Speak.

          • Caleb from Somerville, MA

            Thanks, Bruce. You’ll have more interest in the uprising when – without any $ for retirement – you’re pushed into a min. wage job (whose real value will be even less than its abysmally low level at present) and your kids are unable to attend college, which will be the sole provenance of the wealthy, because the only opportunities for those without substantial starting reserves are similar positions. When, on top of that, few to no private employers offer health ins. and emergency health services are cut for the working poor, and when Soc. Sec. no longer exists and when they finally cut age, hour and wage protections, then you’ll be interested in some uprising. The stupid masses only wait until it’s too damn late and pass off my petition campaigns and organizing events as boring, activist self-entertainment when they still have a tiny bit of a say.

          • Bruce from Boston

            Well said, and in this setting the ideological consensus so easily secured in the past century of American dominance crashes on the rocks of reality. It is hard to sustain legitimation with threadbare platitudes about free markets when conditions change. But when this cannot yet be seen with politically viable impact … throw a bomb and the streets will come alive? Your well phrased words are more powerful. You should keep speaking.

          • http://www.facebook.com/profile.php?id=1408098372 Mari McAvenia

            “If it’s not abundantly clear, the entirety of the Republican Party and over 1/2 of the Democratic party has been fully bought by the Multinational business lobby.” – posted by Caleb

            It is not clear enough to the ordinary American “consumer”.
            Like house pets, we laborers, artists, writers, dramatists, musicians have been “put to sleep” by the masters. Unless they love us a whole lot- ie: makes ‘em a load mo’ $- staying alive and connected has rarely been so challenging. That’s usually the most obstructive thing artists ever face, anyway. Just staying housed and fed – isolated & alone- take all the steam out of most “creatives”. Nuthin’ new there.

            The internet and web-based (sound anachronistic?) media like OnPoint’s new format can do dramatic things in a short time, though. Stay tuned.

            Calling all creators: the work is hard, you get paid nothing but the respect of your peers. Ugh…and maybe a huge paradigm shift, if we’re really lucky. Let’s just survive 4 now, OK?

      • labored

        There are great resources available for teaching this stuff in our K-12 schools at http://www.labor-studies.org/

    • Ctwood2

      In grade school??? What high faulting school did you attend? Hopefully you didn’t discuss the butchering scenarios after lunch!

  • Pingback: Business Is Great When Its Good | Justin Harvey – Creative Consultnat & Multidisciplinary Artist

  • http://eventronics.com/blog Mspindelman

    Great perspective.

    Wealth creation is in fact different from wealth re-distribution. Growing markets, opening new markets, and serving society is a noble objective.

    Companies focus on productivity which is a bottom line view of corporate governance. Top line growth comes from growing markets as you so eloquently have pointed out. Yet companies historically have been operating at a decreasing lower hierarchy of needs fulfillment.

    Quarterly mindset, bottom line focus, cost containment and profit maximization have helped reinforce greed. The shift you talk about is hard to imagine in the realm of corporate thought currently improving financial results.

    Building communities comes from job creation. Corporations and governments have been long embracing outsourcing. Job loss from outsourcing has been small compared to lights out manufacturing.

    Social goals are people goals. Automation overall becomes the un-discussed job killer. Yes, Innovation is the ultimate growth factor, yet companies innovate through acquisition instead of internal research and development.

    Global companies are process focused with a vision of removing and elimination. The perspective you discuss requires a tenure change in upper level management including boards of directors. That typically happens at a snails pace.

    There tends to be a myopic view ingrained into the culture of businesses. The culture shift you propose requires a tipping point that doesn’t seem possible in a lifetime.

    Kindest Regards,
    Michael Spindelman
    http://eventronics.com/blog

    • labored

      The history of the evolution of the employer/employee relationship from its roots in the master/servant and master/slave relationships is untaught in our schools. Why don’t average employees work 10-16 hour days, 6-7 day workweeks? Why don’t they work in dangerous working conditions for just enough money required to reproduce the workforce? That’s the story of the 1800s. Was it enlightened employers who voluntarily began sharing their wealth by improving wages, hours, and working conditions? NO. It was the labor movement that not only forced employers to broadly share their wealth (redistribute it really); and it was the labor movement along with community allies who got legislation creating workplace and environmental rights OVER the objections of large employers, their associations, and allies in legislative bodies.

  • Dave in CT

    NEW FORMAT COMMENTS

    Appreciate all you hard work on the new formats.

    Two comments:
    1) Ranking by Newest First only works on the Root post, so hard to find new replies to older roots. Perhaps show new replies with link/toggle to the hidden root? Tough one.

    2) Ranking by Like, only lists most liked Root comments too, so Replies to Root comments liked by many, don’t get listed. Similar challenge to above I guess.

    Thanks for your efforts.

    • Dave in CT

      ….all YOUR hard work….

      I guess I wouldn’t mind the review before post option too….

    • Zeno

      I noticed that you can get to the root of the reply by clicking on the time stamp.

      • Zeno

        Oops – not the time stamp but the ( posted as reply to… )

        • Dave in CT

          Cool. So maybe if when one select Rank by Most Liked or Most Recent it could list those, Replies or Root, and let us click that “in reply to…” to get back to the root.

          Right now I think the rankings only work on Root comments.

          thanks for the tip.

    • Ellen Dibble

      Dave, I had complained about not getting replies on Saturday, and yesterday I was seeing replies bounce up with new posts, and the site was letting you click right there and open the post it was responding to. I think it was letting you go to the spot in the thread too, but maybe not. I call it “generations of reply,” and wanting to see the whole chain sometimes.
      By the way, we lost the capability of “collapse” which would let you shrink any post to just its title, which would be useful if you were shrinking all the ones you’ve read.
      I’m thinking if you don’t see Replies, Dave in CT, maybe you’re not using Discus. When I open OnPoint it tells me I’m opening as a member of the Discus community. And maybe people opening as Discus have their “like” comments treated differently.
      I say that because up top there is a tiny blue box where you can “expand community,” which turns out to be Discus, and it shows members who have posted, how many, and how many likes. And this is a kind of farce, because it sure doesn’t show my posts, and it doesn’t show when someone clicks “like” either. By clicking on other Discus members, I see that they have posts in other forums, and someone with a lot of “likes” might be getting a ton of votes from his or her home town paper, where this is what everybody does. But I also notice that most Discus members, when they click “like,” their name shows up next to the vote. Me, it doesn’t show up. Ah, the thrill of anonymity. But then again, my vote doesn’t show up. If I vote for Yar, who always ranks first, it doesn’t show up. If ANYone votes for me, it apparently doesn’t show up. With one exception (it seems to me), which would be Sam Gale Rosen, who voted Like for me yesterday, and who also yesterday got added as a Discus member. So thanks, Sam. However, you did it, your vote counted. Meanwhile, I’m boycotting voting for Yar. He has plenty of kudos. Just kidding.
      If you are not using Discus, a whole other set of experiences may apply. They may not be coordinated, I’m thinking.

      • Dave in CT

        thanks Ellen, will look into that.

      • Zeno

        Ellen the collapse thread is done by clicking the “-” symbol in the header when the mouse is within the comment displayed.

      • Yar

        Ellen, I don’t think you are using the same profile you created to post your comments as the other day. I clicked expand Ellen’s profile on the Generic avatar by our name and none of your comments show up. It is like you are using an anonymous public profile. The community is really much easier to use if people will join.

        They may be still working out bugs, I like seeing email responses that come hours after I left the blog and see that I got a reply to my comments. I like the conversation, it is easier to follow when I can see the context of a reply without searching for the original post. I encourage people to join. You can still remain anonymous but be the same anonymous each day. Make a custom Avatar. That way you know you are using the same profile each day. I picked yar because it is an easy word to search to find a reply. My name Ray, shows up everywhere.

        • Ellen Dibble

          I’m going to try something else, which is, click Disques when I post the reply, get adventurous, see what else is on offer. Thanks, Ray.

        • Ellen Dibble

          I’m going to try something else, which is, click Disques when I post the reply, get adventurous, see what else is on offer. Thanks, Ray.

        • Ellen Dibble

          Yep, I was posting as “guest,” and after clicking disqus, it let me merge “guest” with my other profile. It looks like I’ve got one version with capital letters and one without. So…

          • Yar

            Change your Icon picture and then you will know if you logged into the correct profile. If everyone will join the On Point community it will make the conversations flow and make sense. If most people remain as guests it defeats the new format. Threads can take a life of their own, I am really looking forward to Pancake and Brett joining. Many others as well.
            I like the edit feature too. I don’t know if that works as a guest.

    • Zeno

      I found a bug with the discus system. if the originating thread is too big to fit in the browser window when the use clicks the “in reply to” it centers it and leaves it locked and not scrollable.

      No place to go but back to the original link to redisplay the entire page. They need to fix that, because my screen resolution is set to 1680 by 1050, and I’m using a small font. It still could not view the entire root thread top and bottom.

    • Scott B, Jamestown, NY

      Not thrilled with the way it wants to auto-fill whatever I last posted in the letter body.

      Isn’t there a way to have it remember my email and the name I want to post as? Yesterday it was fine, today it alternates between wanting to post my email for both, or leaving my “post as” form blank.

      I know it’s new and is in need of tweaking, but it gets frustrating.

  • http://www.udarrell.com/my_pages2.htm Udarrell

    Reich, we agree on nearly everything.
    Further, reducing deficits is a three legged stool; 1) Using the private sector trillion$ by motivating individuals & businesses to fuel the new Energy Sector Economy which will greatly reduce energy trade deficits while greatly increasing tax revenues 2) letting wealthy tax cuts sunset, over ten years is 3.9-Trillion$ of tax revenues needed to avoid cuts that would harm economic growth 3) make big cuts in military spending & bring our troops home.

    Ruthless cutting of govt needed programs will shrink the economy & result in larger local state & national deficits & a dead economy starved for tax revenues.

    The president & all Dems & R’s ought to flood the media with these economic, job & tax revenue realities!

    Udarrell in WI

    • Worried for the country (MA)

      “1) Using the private sector trillion$ by motivating individuals & businesses to fuel the new Energy Sector Economy which will greatly reduce energy trade deficits while greatly increasing tax revenues 2) letting wealthy tax cuts sunset, over ten years is 3.9-Trillion$ of tax revenues”

      1) New energy sector will be a drain on the economy UNLESS it is cheaper than coal. You just have to look at the disaster in Spain. There is one hope that can be fast tracked and that is GEN IV LFTR nuclear. It can be cheaper than coal and synthesize liquid fuels for < $20/barrel. Even that is best case 5 years away with a crash program.
      2) Restoring the entire Bush tax cuts will restore $3.9T of revenue over 10 years. Just restoring the top rate will only net $.9T. Not sure if that's what you meant?

      • William

        So, the new energy economy like the “Cape Wind” project? A single project that has taken 9 years and still no energy?

        • Worried for the country (MA)

          Cape Wind is the poster child for new energy. 3x the cost WITH the subsidies. Try and scale this and you will quickly go bankrupt.

    • Worried for the country (MA)

      “1) Using the private sector trillion$ by motivating individuals & businesses to fuel the new Energy Sector Economy which will greatly reduce energy trade deficits while greatly increasing tax revenues 2) letting wealthy tax cuts sunset, over ten years is 3.9-Trillion$ of tax revenues”

      1) New energy sector will be a drain on the economy UNLESS it is cheaper than coal. You just have to look at the disaster in Spain. There is one hope that can be fast tracked and that is GEN IV LFTR nuclear. It can be cheaper than coal and synthesize liquid fuels for < $20/barrel. Even that is best case 5 years away with a crash program.
      2) Restoring the entire Bush tax cuts will restore $3.9T of revenue over 10 years. Just restoring the top rate will only net $.9T. Not sure if that's what you meant?

  • Robert Hennecke

    Robert, economists use Adam Smith for their own ends

    In the monumental year of 1776.
    That year I’ll always remember, yes I will.
    ‘Cause that was the year, Adam Smith wrote his book.
    I never got a chance to meet him.
    Never heard nothing but good things about him.
    Obama, I’m depending on you, to tell me the truth.

    And Obama just hung his head and said,
    “Robert, economists use Adam Smith for their ends.
    They overlook that Adam Smith never advocated for slavery
    Now that he died, CEO’s get to misuse his philosophies
    Benedict Arnold CEO’s, off-shoring to the PRC, yeah, yeah, yeah .
    And do they care, 13 years olds are dying working 16 hour days
    Now that he died, CEO’s get to misuse his philosophies.”

    Well, well. Yeah !!

    Hey Obama, is it true what they say,
    that CEO’s never work a real hard day in their life?
    And Obama, bad talk going around my town
    saying that CEO’s grabbing handouts and lobbying for influence.
    And that ain’t right.
    Heard talk bout Roche selling livers of Chinese political prisoners.
    They talk bout saving lives but theys in bed with repressive regimes
    Dealing in hearts, while claiming they be saving the world .

    And Obama just hung his head and said,
    “Robert, economists use Adam Smith for their ends.
    They overlook that Adam Smith never advocated for slavery
    Now that he died, CEO’s get to misuse his philosophies
    Benedict Arnold CEO’s, off-shoring to the PRC, yeah, yeah, yeah .
    And do they care, 13 years olds are dying working 16 hour days
    Now that he died, CEO’s get to misuse his philosophies.”

    Well, well, yeah !!!

    Hey Obama, I heard Jack Welch be your new big time advisor.
    Tell me is his plan to send the US to an early grave
    Folks say Jack never saw a repressive regime he didn’t off-shore to.
    Hey Obama, folks say that ol Jack was never much on thinking.
    Spent most of his time sending jobs to the People’s republic of China.

    Obama, I’m depending on you to tell me the truth., Obama looked up with a tear in his eye and said,
    “Robert, economists use Adam Smith for their ends.
    They overlook that Adam Smith never advocated for slavery
    Now that he died, CEO’s get to misuse his philosophies
    Benedict Arnold CEO’s, off-shoring to the PRC, yeah, yeah, yeah .
    And do they care, 13 years olds are dying working 16 hour days
    Now that he died, CEO’s get to misuse his philosophies.”

    “Robert, economists use Adam Smith for their ends.
    They overlook that Adam Smith never advocated for slavery
    Now that he died, CEO’s get to misuse his philosophies
    Benedict Arnold CEO’s, off-shoring to the PRC, yeah, yeah, yeah .
    And do they care, 13 years olds are dying working 16 hour days
    Now that he died, CEO’s get to misuse his philosophies.”

    • labored

      “This disposition to admire, and almost to worship, the rich and the powerful, and to despise, or, at least, to neglect, persons of poor and mean condition, though necessary both to establish and to maintain the distinction of ranks and the order of society, is, at the same time, the great and most universal cause of the corruption of our moral sentiments.” Adam Smith, Scottish political economist in his 1759 The Theory of Moral Sentiments

      • Robert Hennecke

        My Adam Smith story is meant to be sung to the tune of
        ‘papa was a rolling stone’.

  • Dave in CT

    RE: the current system imploding, debt already beyond repair etc sentiments.

    Almost every time Ron Paul is interviewed, and asked whether he can really win for President, or What will it take for the politicians to get real about our predicament, he always answers quite forthrightly that he foresees a major financial crisis on the horizon, destruction of the dollar, and while its unfortunate, that will be the only way we deal with our structural/philosophical/political problems, not through reasoned foresight.

    You don’t hear the 2 parties speaking so candidly. Wonder why.

    Ron Paul on Morning Joe recently:
    http://www.campaignforliberty.com/#40745

  • John Michaud

    Please tell your guests that its your show and they are the guest. Its not a platform for then to talk over you. Its annoying when you try to say something and they just keep talking and both of you wind up talking over each other. Its your show and they should stop talking when you want to say something. You are trying to guide the conversation and they just want to lecture. (not all guests) Please take this as constructive criticism, I love your show and listen every day.

  • Sendicott

    Two comments:
    1. Both Reich and Porter would like to reduce and streamline regulations by directing them at their root goals, i.e. tell companies “You just reduce your pollution and we will leave you alone.” The problem is that companies fight this kind of regulation because it is vague. The first Cean Air Act was written this way and it resulted in a lot of litigation, but inadequate clean-up. It was later re-written to allow the regulatory agency to specify acceptable technologies for certain industries
    2. The caller who placed the blame on corporate-owned politicians had it right. We should consider campaign finance reform and eliminating the protections and rights that corporations are given. Hold CEO’s responsible for the company’s actions. Send a few to jail. Tell the Supreme Court that corporations do not have the rights of individuals.

  • at, Santa Crux, CA

    Corporations are not the answer. It is so obvious that America has the best most talented population in the world (you can’t beat hybrid vigor). Did you watch the Grammy Awards? Can you imagine any other country in the world producing so many talented artists? The people of the US are genius, they have been entrapped by the coercive activities of the most uncreative persons of society (the financial industry and politicians) If we can get these bastards off our backs we will ascend to new heights of prosperity and creativity the likes of which mankind has yet to witness.

  • feethelove

    Another testosteroneless dweeb spreading nonsense.

  • twenty-niner

    The problem is not capitalism, it’s globalism. The headline says it all:

    “Apple sent top exec to China after rash of suicides at supplier plant”

    http://www.mercurynews.com/ci_17386584?source=most_viewed&nclick_check=1

    I, for one, refuse to buy any products so blatantly manufactured with slave labor. Unfortunately, such products are getting ever harder to find.

  • Gary2

    cant be fixed

  • DeeDee

    As Americans, we speak as if the “government” is a different group, and “the corporations”, the “politicians” are some other people. IT IS “US”, WE THE PEOPLE! And when you can turn a blind eye to the problems of your community, destroy the land that feeds you, pollute the air and water required for life, for your own self advancement or to have the best car, what other outcome is possible but self destruction. Corporations are acting like an infection in our society, and they don’t care if they kill the host, which I need to remind you is “US”.
    Americans are addicts, to money, food, drugs, and instant gratification, instant profits. So just look in the mirror, because to expect a corporations to suddenly develop biblical morals, is to expect the average American to suddenly quit smoking, take care of their health, exercise more, eat healthy, follow the laws and regulations because that is fair to the next guy. Imagine that, following the rules just because it is FAIR AND RIGHT. All the laws and regulations are to try to get “US” to act in a Fair and right fashion. It requires discipline. All these discussion, like trying to figure out which is the best religion, it is pointless. The answer is in each person, and expecting “US” to behave better, won’t come from someone at Harvard, who obviously can’t look in the mirror anymore and teach profits first, but it can only come from each one of “US”.
    So I do agree with Mr. Porter’s vision of the direction corporations should go, but it will only happen when “WE, “US” also agree with that direction.

  • Micahellong100

    My grandfather told me their are only two basic business plans on earth. You can produce a great product that people will want to pay for and you can make a wonderful profit or you can try to find ways to cheat, steal, lie, add to the fine print and misrepresent your product. Both business plans can create great wealth but only one business plan creates a great society.

    Five (should be bankrupt) banks own two thirds of the wealth in our society. They have avoided legitimation regulation by presenting fraud, usury, and simple theft as noble entrepreneurial ventures. They use our deposits, out tax dollars, our countries credit rating, our status as a reserve currency, our federal reserve, our children’s futures and our accounting system to create great profits, buy our politicians, and present themselves as wonderful entrepreneurs.

    • ulTRAX

      You forgot getting filthy rich by manipulating speculative markets. Parasites like Goldman Sachs suck on the lifeblood of the productive economy… and produce no value of their own. The demand for their services is for the high profits they earn gaming the system…

    • http://twitter.com/grassfedorganic Rocky Mtn Org Meats

      That actually create nothing!

  • Feethelove

    The United Kingdom sucks. Death to royals worldwide. Kill them all and let the eternal vacumn sort them out. Limited time abdication, get out of the hell free card, price — everything you and your families own.

    You were a bad, bad-dog. Now you are drawn, quartered and your parts dispersed to the districts to be hung on pikes until they rot. We will never forget you and your tender mercies.

    • Cory

      Strong candidate for deletion.

      • Ellen Dibble

        I think the red flashing word “flag” at the lower left suggests deletion to the monitors. I agree. There are monarchies — Britain comes to mind — where stability and even fondness and pride are associated with monarchies. Elected officials can bring abominations, but there is always the monarchs with their winning ways, umm, sort of. A few eccentrics can’t do a lot of harm if the constitution is set up right.
        I was going to be clicking on Flag as a way of voting Yes, Notice this, and I hope the monitors can tell the difference if someone else goes happily clicking flag, flag, flag.

    • geffe

      I think this is a childish prank or something akin to that.
      Already flagged.

  • Feethelove

    The United Kingdom sucks. Death to royals worldwide. Kill them all and let the eternal vacumn sort them out. Limited time abdication, get out of the hell free card, price — everything you and your families own.

    You were a bad, bad-dog. Now you are drawn, quartered and your parts dispersed to the districts to be hung on pikes until they rot. We will never forget you and your tender mercies.

  • TomK

    Reich has it right, but it’s sad that we have to rehash this argument over and over. Unregulated, sweatshop capitalism and communism are two extremes of the economic spectrum. Both are failures. The best solution is in the center, as usual. All economies in the world are a mixture of the private sector and the gvt. We are both capitalist and socialist.

    The USA had the mixture right from the 30s to 1980 with high taxes at the top and strong regulation of the corporations – which nevertheless were thriving. With the onset of “voodoo economics” in 1980 we started moving toward the sweatshop extreme, with predictable results: a deteriorating middle class and a growing oligarchy.

    We don’t need a new system, we need our old system. Simply getting back to reasonable top tax rates would do more to alleviate the deficit (which is no big deal) than all of BHO’s (does the H stand for “Hoover”?) proposed squeezing of average Americans. Simply getting back to Glass-Stegall and reasonable limits on financial leverage would make our system a lot safer than it is now.

    • Scott B, Jamestown, NY

      When Daimler was buying Chrysler, and the German execs saw what the American execs made for salaries, they were dumbfounded at how much the American execs made, especially for a company that was hemorrhaging money. Execs in other countries simply don’t have the staggering wage difference that the US does.

      This sense of executive entitlement, and lightening the financial load by jettisoning those at the bottom first. The problem seem to be who starts it in this culture of greed on Wall St?

    • Stacyoh

      i never understood how/why that (glass stegall) was repealed.

  • Katestewartyoga

    Robert Reich is the most intelligent and articulate cabinet member we have had. Thank you so much for having him on.

  • ScottC

    The encroaching nature and influence of big business has contaminated our decision making process. The art of crafting governing laws should be devoid of all outside biased parties.

  • Scott B, Jamestown, NY

    Weed out anyone that’s been employed by Goldman-Sachs (aka “Government-Sachs). Then re-fund the SEC and fill it full of accountants and not lawyers so they can run down the abuses that caused this crash. Make the SEC independent from meddling, much like the CBO, so that it cannot be stripped down to 14 people with broken equipment because the admin or Congress wants to to back-door deregulation by gutting it and effectively making it toothless and unable to function properly.

    There are some very small Wall St. guys being trotted out for a perp walk on the crash, but they all seem just to have gotten sucked into things rather than been pulling the strings on all the bad paper. But they don’t have the $$$ for the room full of lawyers to defend themselves like the guys at AFG, Goldman-Sachs, Bear-Stearns, et al, that knew they were selling bad paper.

  • Miguel Checa

    Great interview! Tom
    I am still persuaded that effective campaign finance “revolution” is one key to reining in $plutocracy$.
    Because society charts corporations, WE–society–ought to periodically review their real impact on the well-being of life–and revoke the charters of those who damage life or not contribute to its betterment.

  • david

    Heard on the news that the NYSE may be bought by the Germans. Maybe they will move it overseas and solve Americas problem with the evil stock market.

    • Zeno

      I provides a trading channel into American markets without government regulatory interference. IMO – Not good at all, like having your mortgage residing somewhere outside the US…but nobody knows where.

  • Chasbrooks

    How about working toward a system where money and debt become obsolete aka Zeitgeist Moving Forward

    • Zing

      Great idea, chas, but won’t fly with all the crybabies who feel entitled to good jobs, big benefits, and no acoutability.

  • GMG

    Thank you for an excellent and interesting discussion! The idea of the 10-year renewal of corporate charters with public input is very interesting.

    I think we tend to forget that commerce requires at least some marginal consideration of the broader welfare, normally expressed by regulation, to keep from devolving into organized crime, and that we the people define the boundaries of the fair market.

  • Dfallek

    What about greed and it seems that the heads of these corporations are buying into their own advertising about more is better. Also, why on earth are corporations considered individuals. i know all about the supreme court decision that did it, but it makes no sense at all. All i recommend that EVERYONE see the documentary “THE CORPORATION”. it shows that if a corporation had a personality it would be sociopathic.

  • Zing

    Another great show proving the all commentators have an opinion, but no one has any capital and likewise no practical solution. And who among you is prepared to die in the first wave of your revolution? Get your guns but remember where your feet are.

    • Ellen Dibble

      If George Bush 43 had indeed gotten everybody’s Social Security invested in the stock market, then we would all have our feet therein, and any revolution would be against our own interests. As it is, the babyboomers have their feet pretty well sunk in it, unless they have financial planners of the truly unusual variety, without any taint of the casino to their maneuvers, but purely investing in innovation and productive growth.
      People posting here suggest that we can no longer sprout such enterprises, and indeed if enterprises can only get seed money from the plutocrats and their lackeys (sorry, I borrow some terminology there) when they can reasonably promise investors quarterly returns practically by the turning of the next full moon, then only speculative ventures can occur henceforth.

  • Shahid Rahman

    Hello: Isn’t this problem more related towards the responsibility of the corporations. Responsibilities not only towards the economic aspect of the corporations but also towards the environmental and social aspects as well. I completely agree with Michael on this subject.

    Best Regards,

    Shahid Rahman

    • http://www.facebook.com/profile.php?id=1408098372 Mari McAvenia

      Corporations, unlike real people, have all the commercial rights with zero social or civic responsibilities. They’re perfect cancer machines: all about growth (think tumors) with no concern for the hosts. The problem is they grow on real communities full of real critters. They just never have to think about that. We do.

      Corporations must carry out a mission of iatrogenic economics. In other words, money that makes everything & everyone sick in order to keep itself growing. Sadly, it’s an utterly human invention far more catastrophic than nuclear weapons ever could be in the long term. Thanks for your insight, Shahid.

      • http://twitter.com/grassfedorganic Rocky Mtn Org Meats

        As an organic meat producer I can not sell my ethically raised, environmentally sound, sustainably produce organic ground beef on the internet. I have no loud market voice, will never have a loud marketing voice, and the man want me to think that corprate food should be doing this because it has the resource to make change happen. Come on you Harvard trained never worked a day in your life cry baby trust fund lazy ass. This makes me laugh till I get mad and cry.

    • http://twitter.com/grassfedorganic Rocky Mtn Org Meats

      Corporation are only responsible to share holders not to the communities that they exploit.

  • Joseph

    After listening to this program I can say my response can be as sure and unequivocal as just about any program I have listened to. I would love to believe that Mr. Porter’s argument is sincere and that his vision is achievable, but I don’t. My assessment that he is just engaged in PR for corporations and for business as usual. Large corporations and the wealthy investors that drive these corporations are not unaware that Americans are fed up of what is going on and well soon do something about it. It’s like the cheating husband caught in flagrant delicto with his mistress, and pleads with his wife: “Don’t divorce me, I will change and it will never happen again.” The next day the husband calls his accountant and instructs him to hide as much of his assets from his wife as possible in preparation for a divorce.

    • http://twitter.com/grassfedorganic Rocky Mtn Org Meats

      Yes, for change to happen it is going to have to be forced. And that force can be market driven but from the bottom up. Stop sending money to wall street by spending on shit you don’t need. Keep it in the community where you live and work. Tough yes but turning a ship this big is not going to be easy, they know that!

  • Glenn K.

    I don’t think you can talk about ‘capitalism’ as an economic system without also considering the size of the organizations that practice it. A small, locally organized corporation is more likely to be in touch with the community around it, and respond to its needs (and feel the impact of the community on it) than a very large organization. The very large organization loses touch with its roots. It serves no one community or set of communities, but rather must by its nature become distant from the people that work within it or are its customers. It’s necessary for it to be more likely to think of people as numbers, percentages, masses of people flowing in rivers known as “markets.” In other words, size matters! Size matters much more than theoretical systems. That is, if an organization gets big enough, to the people it will seem the same, more or less, regardless of which theory it claims to operate. Power corrupts. The more power you amass, the more corrupt you are likely to become.

    • http://twitter.com/grassfedorganic Rocky Mtn Org Meats

      I do believe we are watching this beinf played out in Egypt today. Concentrated power is not healthy, just as our food system is concentrated in the hands of a few very powerful (politically connect corporation) we the people are standing on the edge of corporation using Food as a weapon.

  • henrygeorge

    One word solution: Geolibertarianism

  • http://whatsnotso.blogs.com Tom Hagan

    Ever heard of “dark factories”? When the last robot is slid into place, there is no longer any need for poeple, so the lights can be turned out. No more “op ex” for labor, only “cap ex” for caspital expense: new and better robots.

    As production becomes more and more capital intensive, productivity per worker hour increases. Until it goes thorugh the roof, as it is doing now. But as labor productivity increases, the share of revenue that workers tske decreases, more and more goes to capital. Those who own stock take more and more of the total GDP.

    Overall result: increasing inequality of both wealth and income. “Them that has, gets” And those who have more, get still more. And more.

    And they own both political parties.

    Both Michael Porter and Robert Reich are missing the point altogether. Jobe are gone for good; they are not coming back. “Shareholder value” is significsnt only for shareholders. The bulk of humanity does not own shares. We are staring into an abyss where most people cannot contributs anything of value to the economy.

    Horses were needed in great quantitiy for transporttion 100 years ago. When the automobile came along, we needed them no longer. There are far fewer horses now. The “labor movement” can forget about ever being relevant again. There isn’t going to be any labor to speak of – except for slave labor in China.

    Those at the top of the wealth pyramid are doing very well. To assume that better regulation would insure the future of the economy is like assuming all would be well if only the poker players first class were forced not to cheat as the Titanic steams through the night.

  • Hootiefogg

    I did not listen to the entire show…so I apologize if this is redundant…I have worked in Retail for about 15 years; 6 on them were for Patagonia Inc., and the other ten for a Patagonia Dealer, where I currently work, Patagonia on Thames Street, in Newport, RI. Patagonia, historically, is an already living example of what Mr. Porter suggests is the future of business…starting with philosophy trips in the 1990′s, Yvonne Chouinard examined why we were in business, and whether or not we wanted to grow the business?…and how to do all that being enviromentally sound…the company conducts internally audits on how their products are affecting the environment….and people continually comment on knowing these facts when they shop in the store…people want to be part of what they feel is right….that is what will sell n the future…answering real needs, with sincere, well thought out, least harmful for the environment, products. It is what makes most logical sense.

  • Paul

    Have Michael Porter investigate the third largest Mortgage company in the U.S., Ocwin.

    Google “Ocwin” and see all of the comments by all the people adversely effected by this greed driven corporation which is literally destroying peoples lives.

  • Parkerchuck

    So if your hair doesn’t go up when you hear a mouthpiece like Michael Porter talk, then you’ve already sold your soul too many times time know the truth anymore. What utter crap! And I’m usually Mr. Professional and would join the dance pretending that he has a honest POV and we should talk respectfully as if this is very valid and productive. All those born yesterday raise your hands!

  • xirtam

    the conservatives have a lot of rhetoric about less government intervention in the affairs of corporations but where do you suppose they would stand on that law about the corporations being required to make the their shareholders as much money as possible? where is that written anyway? what’s the history behind that law. perhaps it was written with good intentions but….

    • William

      Well…it is the people that invest, i.e. shareholders, that provide the money for companies to start and grow. If you want the government to take over that role, well, we saw that idea fail with the USSR.

  • john smith

    The ENTIRE problem with our current system is monopolies. Businesses right now are WAY too large. Certainly capitalism CAN be the best system in the world, but ONLY if we eliminate monopolies. Monopolies inherently breed corruption. Companies should be limited in size to no more than 50 people, and they should outsource work to other companies if they are incapable of producing their product with 50 people. Certainly we cannot achieve this goal overnight. Thus, the ceiling should be lowered slowly. This WILL solve all of our economic problems.

    • Dave in CT

      The Role of State Monopoly Capitalism in the American Empire

      http://mises.org/journals/jls/15_3/15_3_3.pdf

      • john smith

        I’m not talking about outsourcing to overseas companies. I’m talking about one company in the United States outsourcing part of it’s work to another company in the United States. I know the word “outsourcing” is used frequently (perhaps TOO frequently) to meaning shipping American jobs overseas, but its general meaning is more broad. It simply means to contract out work to another company.

        • john smith

          However, you bring up a good point, which is, the entire reason for our import/export trade imbalance is, once again, due to the fact that we have these monopolies that aren’t anywhere near as effective as they could be if they were broken down into competing companies.

          However, when companies are limited in size, this does two things. First of all, it makes job security very low for any one job. People coming here from other countries many not understand this. In many countries (including, somewhat in the US) a job is seen as an entitlement. HOWEVER, it also makes OVERALLl job security VERY high (much higher than it is right now). Because companies are constantly hiring and firing, they are always looking for new employees. This forces the unemployment rate down to rates currently unimaginable. It would be something like the theoretical maximum. Somewhere near .01% unemployment. Just absolutely insanely low unemployment.

          The inherent reason why our politicians aren’t changing the system like this is because then “THEY” LOSE CONTROL, and the system becomes fair, and our government would actually work. In other words, they are rigging the system, for THEIR short-term benefit. And as long as the people continue to let them do that, THEY WILL.

          • john smith

            As a side note, this is ALMOST how America used to function, when it was effective 19th century. But, in the early 20th century, more and more businessmen began to figure out that they could rig the system (and not get caught by the government!!!) by creating these enormous monopolies. And, thus, was born what I like to call “corrupt capitalism”.

          • matrix

            capitalism was just hunky-dory back on those plantations- as bill cosby liked to say – “yeah, right”. plus, i’m not sure that we were that far behind england in our industrial disease during the 19th century. that said, i agree with you in that many of the famous magnates, moguls, and robber barons arose in the early 20th century. robber baron, by the way, according to wikipedia, is a 19th century american term.

          • mtaxri

            name one monopoly. i don’t think they exist. the only monopoly i can think of is the federal government.

          • Stacyoh

            monsanto

          • Dave in CT

            Are they forcing you to buy those GM seeds and roundup you need to survive? If there was more demand for that moronic technology (another techno stab at a free lunch), there would be more companies doing it. I’m sure the govt is involved in helping American farmers be good Monsanto customers, and keeping the monopolistic tendency going. I have no problem with limited life patents to reward ideas. Thats not a monopoly. Thats a reward for innovating (as long as we are sure patent laws are fair and reasonable).

            But you are not being coerced into buying GM. Buy organic.

          • ulTRAX

            Dave naively spouts his pro-market 101 dogma claiming that consumers have the power to vote with the dollars and modify the most egregious behavior of organized and powerful corporations.
            While in pure theory that’s true, in reality it’s not.

            A perfect example is how difficult it is to protect our privacy on the web. Even the privacy conscious, web-savvy surfers have a difficult time keeping up with the intrusions and tracking. So how do the less savvy, less technical, internet users stand a chance? Just when they learn how to delete cookies we find out our browsers can be fingerprinted and sites can steal our browsing histories. What would Dave’s suggestion be then? That the problem isn’t with the websites that track and steal info from us…. but the internet users are at fault for not protecting themselves?

            Corporations always have the advantage in the market because they are organized and single minded while consumers are disorganized and have more to do in life than research every investigate every single product looking for the latest corporate outrage. But in Dave’s world, corporations are blameless and all the responsibility for making them behave falls on consumers.

          • Dave in CT

            “Just when they learn how to delete cookies we find out our browsers can be fingerprinted and sites can steal our browsing histories. What would Dave’s suggestion be then? That the problem isn’t with the websites that track and steal info from us…. but the internet users are at fault for not protecting themselves? ”

            Nonsense. I have never suggested the little guy be expected to navigate organized crimes. If we think fingerprinting our computers is wrong, perhaps an intrusion on our Liberty dare I say, than we declare it illegal by law. Then, when your organized corporate pirates do it anyway you throw them in jail for 5 yrs. Not enough? 15yrs. Not enough? Life. Whatever it takes to enforce the Rule of Law that protects our Liberty and our freedom from coercion, which all that unconsenting web tracking is, if not trespassing.

            Its clear you and some others don’t really consider what I say, or what the ideas in the links I post say, but rather read a few words, get your preconceived and confused notions about what Liberty is about into your mind, and then accuse of ideas I don’t espouse.

            Where have you seen me defending corporations here? I keep talking about collusion between corporations, banking, and government, the elite that has fleeced the regular guy, either by design, or by well-intentioned mismanagement, for centuries.

            I am raising the idea that only a tenaciously enforced rule of law, that treats all equal, and picks no favorites, and punishes corruption and collusion, the elements of corporatism.

            If you don’t see a difference between state supported corporatism and free capitalism practiced within a clear legal framework designed to protect us from our human tendencies, then you have some more reading to do.

            If you want to advocate Socialism as the only logical alternative to corrupt State Capitalism, as the best way to protect the freedom and opportunity of the individual, go ahead, but there are other alternatives, and the Socialism one hasn’t really worked out that well for the little guy in real life.

            There is so much we could agree on and explore, but alot of folks are so defensive and dogmatic, especially against what they think they need to hate as good progressives or liberals or conservatives or whatever. That is one of the biggest problems holding our country back. Divided and nearly conquered.

    • http://twitter.com/grassfedorganic Rocky Mtn Org Meats

      Give local control to companies where these companies are extracting their value. This will assure that they are working for the good of the community not for the good of a group external owners.

      • john smith

        Are you talking about governmental control? That is a TERRIBLE idea. The last thing we need is for companies to control people.

        • john smith

          Our governmental system works fine as it is right now. However, if there were anything I would do to improve the system, it would be to double (or even quadruple) the number of senators and representatives. People just aren’t being represented or heard, because there are too many people per senator or representative. Secondly, I would reduce term limits to 1/2 (or 1/4) simultaneously. Politicians are becoming corrupted by the extended duration of their term limits. Both increasing the size of congress AND reducing term limits needs to be done at the same time, in order to preserve the correctness and balance of the system. I would also recommend doubling the size of the supreme court to 18 judges.

  • Dave in CT

    “From Prison, Madoff Says Banks ‘Had to Know’ of Fraud”

    http://www.nytimes.com/2011/02/16/business/madoff-prison-interview.html

    This is our moment to punish the corrupt elite bankers and any politician leeches attached.

    Whether you see them as wrong from a moral, libertarian, pragmatic, progressive or liberal angle, all decent people who see the rule of law at the core of our society and economy should be able to get behind the quest for justice.

  • Stacyoh

    what does it say about our capitolism that the only reason they are changing their ways is not because it’s the right thing to do; it’s just more profitable?

    • matrix

      it’s not capitalism so much as it is the state of human nature today.

  • rhino

    Just hearing Robert Reich’s first comments. What a great topic and show!

  • http://www.facebook.com/people/Carlos-Eduardo-Oliver/777515483 Carlos Eduardo Oliver

    I worked on several projects via the World Bank’s IFC under the umbrellas of GBI, where Irupana was a paragon of what Mr. Porter is talking about.

  • http://twitter.com/grassfedorganic Rocky Mtn Org Meats

    We need to get the value of the market place back to the land and labor for creating a local clean and environmentally safe economy.

  • http://twitter.com/grassfedorganic Rocky Mtn Org Meats

    Transparantcy comes from local control!

  • http://twitter.com/grassfedorganic Rocky Mtn Org Meats

    Profits are not local they are marginalized by share holders

  • http://twitter.com/grassfedorganic Rocky Mtn Org Meats

    Let them eat the future. Redistribution by forcing a longer investment horizon will not cause a trickle down of value. I do believe mother nature is in the process of forcing value away from wall street and back on the ground. Food is the resource that will drive value, and the land and water to grow it.

  • Rsisodia

    There is an even broader, more holistic way to think about business. Over the past several years, we have studied a group of companies that defy conventional wisdom and at first glance seem to perform financial alchemy. These companies pay their rank-and-file employees much better than their peers, have suppliers who are profitable, invest heavily in their communities, pay taxes at a higher rate, provide terrific customer service, invest in making their operations more environmentally sustainable and do not externalize costs onto society. With all this spending, it would seem that there would be less left over for investors. On the contrary, we have found that these companies dramatically outperformed the market over a ten-year period, by an astounding 9 to 1 ratio (see our book Firms of Endearment: How World Class Companies Profit from Passion & Purpose, Wharton School Publishing).

    We refer to their business philosophy as “Conscious Capitalism,” which is a fast growing global movement (www.consciouscapitalism.org) built around a business philosophy that has four key characteristics:

    First, business can and should be done with a higher purpose in mind, not just with a view to maximizing profits. A compelling sense of purpose creates an extraordinary degree of engagement for all stakeholders and releases tremendous organizational energy.

    Second, the business is explicitly managed for the simultaneous benefit of all of its stakeholders, represented by the acronym SPICE: Society, Partners, Investors, Customers and Employees. A conscious business aligns the interests of all stakeholders, so that what is good for one is good for all. Society is listed first for an important reason: businesses must ensure that they are on the “right” side of society, that they have a positive net impact on the world.

    Third, such businesses have conscious leaders, driven primarily by service to the firm’s purpose, rather than by power or money. They lead by mentoring, motivating, developing and inspiring people, not through command-and-control or the use of “carrot and stick” incentives.

    Finally, such businesses have some unique cultural characteristics, captured in the acronym TACTILE: Trust, Authenticity, Caring, Transparency, Integrity, Learning and Empowerment. The word tactile also suggests that the cultures of these companies are very tangible to their stakeholders as well as to outside observers; you can feel the difference when you walk into a conscious business versus one that is purely driven by a profit motive and just for the benefit of shareholders.

    Raj Sisodia
    Professof of Business, Bentley University
    Chairman, Conscious Capitalism Institute

    • john smith

      I am sorry, but this is just a ploy to take our eyes off of what is really happening. Monopolies are the cause of our problems, and all the “spicing-up” in the world is not going to fix our economic problems. This SPICE and TACTILE nonsense is a simply distraction, almost certainly originating from big business, and marketed to sucker business professors like yourself.

      • Raj Sisodia

        Not true, John. Very few businesses are monopolies, and these concepts did not originate from “big business.” They were devised by us after careful study of what companies that are loved by all their stakeholders do. Business is a beautiful, noble thing when it is done with a higher consciousness and a sense of connectedness. It can deliver extraordinary products, help bring meaning and purpose to working life and create wealth in society that ultimately pays for everything that we benefit from. It can also be parasitic and exploitative if it is done purely to make as much money as possible as quickly as possible.

        Capitalism is just a tool, a powerful social technology. We can learn how to use it in a wise way for common good, or we can use it to destroy the planet and our health. A scalpel can be used to heal or to harm. You can’t blame a tool for how it is used. Likewise, we should not blame the institution of capitalism for the fact that many of us have not used it in the right way.

      • Raj Sisodia

        Not true, John. Very few businesses are monopolies, and these concepts did not originate from “big business.” They were devised by us after careful study of what companies that are loved by all their stakeholders do. Business is a beautiful, noble thing when it is done with a higher consciousness and a sense of connectedness. It can deliver extraordinary products, help bring meaning and purpose to working life and create wealth in society that ultimately pays for everything that we benefit from. It can also be parasitic and exploitative if it is done purely to make as much money as possible as quickly as possible.

        Capitalism is just a tool, a powerful social technology. We can learn how to use it in a wise way for common good, or we can use it to destroy the planet and our health. A scalpel can be used to heal or to harm. You can’t blame a tool for how it is used. Likewise, we should not blame the institution of capitalism for the fact that many of us have not used it in the right way.

  • Henry George

    So much of the problems that have to do with Capitalism are fundamental in the ways that our system of government controls Capitalism. By design Capitalism is an artificial system created by restrictions of law. Law says that one person can’t take ‘property’ from another person. Law says a person who has some property that they can use to make more property gets to keep (taxation aside) the new property also. It’s a system of protectionism to encourage people to create and use capital to make more of it. It’s incredibly effective at motivating people, and creating rapid growth in social economies.

    But Capitalism as an ideal cares about only one thing. Profit. That is just the way it’s designed. Michael Porter seems to have a notion that companies will WANT to become environmentally and socially sound because it’s the right way to be. He claims that this way of doing business can be highly profitable for various reasons such as improving company image and customer loyalty. I think he’s right about the profitable part. But he’s completely wrong if he thinks that the profit comes as a side benefit for anything but a small minority of such companies. Profit is still the driving force. It’s just that there will always be a place for companies who cater to consumers who shop with their consciences. Unfortunately, those consumers will also probably always be in the minority. So MOST companies can’t be as profitable by willingly ‘doing the right thing’.

    Sure, it’s possible that there is and will continue to be a trend toward better environmental stewardship by companies. If there is a trend of consumers demanding this, companies will provide. But it will always be a trend based on what consumers want. Not based on what companies want.

    The root of the problem is quite simple and obvious if you are willing to overlook how incredibly unlikely it is to happen politically in western society. The root is in how we as a society have setup the governance of ‘property’.

    We have used the term ‘property’ broadly to describe land, animals, oil pulled out of the ground, airspace, radio spectrum, intellectual creations and even genetic sequences. We then proceed to treat all of these types of property essentially the same when we offer protections to the individuals and corporate entities who ‘own’ them.

    If we start to acknowledge the differences inherent in the types of property to a greater degree, and change the way we treat them, we can create a system of protection that not only protects the ideal and function of Capitalism in its drive to create greater profits, but one that at the same time protects the quality of the air and the diminishing resources like oil.

    If we re-characterize property into types that can be created as the fruit of labor or intellectual innovation, and those which cannot be created such as land, atmosphere and radio spectrum, we can establish an economic market system in which individuals and corporations will pay a competitive market price to use those otherwise real and limited resources. We can create a system where wealth can be created labor and innovation, but not by simple control of limited resources to the exclusion of others. We can create a tax base that would repay benefit to the communities when some of the limited resources are used or used up by an individual or corporation. We can eliminate all taxation on individuals and corporations for productive transactions while taxing them only for anything real they consume in the process.

    Imagine a society where all companies have to pay so much more to cut down trees for paper that it makes sense to buy as much recyclable paper as they can to make their product. Imagine a society where there is no sales tax, no income tax and no capital gains tax. Imagine getting your full payment for something when you sell it. Imagine getting to keep your whole paycheck at the end of the week. Imagine companies doing everything they can to consume fewer natural resources because it’s more profitable to conserve. Imagine companies being able to hire more workers because they don’t have to pay taxes, so wages go farther.

    Right now imagining is all you can do. Because right now we are deeply entrenched in a system that was designed to protect wealthy ‘owners’ of land who wrote the laws of western society.

    Industrialization came after these laws were setup. So instead of the laws being written to produce the highest production and lowest resource use for society as a whole, the industrialists instead worked to use the strong and established laws that were in place to take resources from the community without paying a fair price, and profit from them while future members of society would have less to use.

    If we are to change the way business works, we can’t simply impose rules that tell businesses to run against their own ideal of profit creation. And we certainly can’t expect anything but a small minority of businesses to be profitable by ‘doing the right thing’. What we can do is change the system. We can transition to a system of government that treats real and limited resources as though they must be shared by all, while treating the fruits of labor and innovation as the real prize to be rewarded.

    Read about Geolibertarianism. It’s not new. It’s evolved.

  • http://www.facebook.com/people/Jack-Greer/100000482123110 Jack Greer

    I’ve listened to many of Michael Porter’s interviews and read several of his articles. He’s obviously a very bright guy and I’ve found many of his ideas appealing, some of his ideas re: needed changes in the health care industry, for examples.

    Sadly, Porter’s position in this interview that corporations are beginning to “see the light” and will work for American social advancement because of some ethereal perception of long term benefit to their business health is … well, pure, unadulterated horse fertilizer. My view of Mr. Porter has just dropped precipitously.

    We need to sever the bi-directional relationship of extortion that exists between our system of governance and our economic system. Unfortunately, I don’t see a path for that to happen. Our system has devolved into a corrupt cesspool with business holding undue influence on the policy defined “rules of the game” – they will not relinquish that power voluntarily … and now with the Supreme Court on the side of non-citizen influence over American politics …

    I’m not interested in punishing business; I want balanced set of results oriented rules (not method directed) that mitigate corruption, that reflect American values, and that advance our national interests and wellbeing – on this front Mr. Porter doesn’t demonstrate that he has a clue.

    • Everythingagent

      Seeing the light from the perspective of a corporation and from the perspective of an average citizens are very different. Corporations have hit a wall of growth, they are now necessitated to spread their acquired wealth over a larger pool of the under served global population so that they can ensnare them all in the loop of working to buy. This protects the wealthy from competition arising out of emerging markets. What the middle class is not prepared for just yet, is that this means the wealthy will have to raise the standard of living globally of the worst off so that they are then in positions to buy essentially things they don’t need (small luxuries). This will require investing truly in quality of life for those currently in the worst of economic situations, but the payoff will be substantial and global as emerging markets acquire buying power and are indoctrinated into a western consumer mentality, knowing their place at the bottom of the hierarchy – as is the intention of the presently wealthy. As I said, what the middle class in America is not prepared for is that in order to acquire this new market, the small profit sharing that used to trickle to the middle class, will now be redirected more globally to the underclasses and the economic state of the middle class will deteriorate more and more right to the edge of intolerance. Just enough not to cause an uprising as in Egypt, but as close as possible to take the pressure off the those with wealth.

  • Tina, RI

    Tom and the OnPoint Staff,

    THANK YOU SO MUCH for putting this show together! I’ve had lots of obligations & appointments ALL Tuesday, so I haven’t even heard more than 5 minutes of the podcast yet, but I can’t wait to “dive in” & to savor and learn from the Comments, as well! Again, listening to your show & reading the blog are like getting access to the best teachers! Many of us who regularly go to the Comments pages of your site HAVE been discussing Capitalism a lot lately. THANK YOU FOR BEING SO RESPONSIVE and for bringing in these two forward-thinking guests!

    I spent tons of time Monday calling/writing my Congressional delegation, friends, and family about the rumor we’ve all heard about the Republicans wanting to cut ALL funding for NPR, PBS, and the Endowments for the Arts and Humanities. I felt honored to try to do my best to help & spread the word! Their idea makes NO sense whatsoever, not even in the context of “spreading the cutbacks”!!! NPR & PBS Generate! more than they Cost financially, intellectually, and aesthetically! They are also Economic Engines, helping to Create Jobs and Wealth thru the Ideas & Curiosity that they Produce that people then take out into the Rest of the Economy & Culture! With so much Great NPR & PBS “Stuff” to experience, Stuff with the Power to Exponentially Generate Jobs, Intelligence, Interest, and Income, it’s amazing to have to watch out for the equivalent of that Norwegian Fairy Tale Wife who Has No Respect for the Magic Fish Who is Capable of Bringing Her Great Wealth!

    Thanks!

    • William

      Stopping federal funding of NPR/PBS would save the taxpayer 4 billion dollars over ten years. Now, is it more important to spending 4 billion dollars on NPR/PBS or not spending that money or spending it on no interest college loans for low income students? Where is the greater good for society?

      • Joseph

        Or how about ending the tax cuts for the top 1% and using that revenue to both fund college loans for students and for great programing like what appears on NPR or on PBS, such as this http://www.pbs.org/wgbh/nova/? Where is the greater good for society?

      • Zeno

        Stop funding the propaganda VOA first. It costs MUCH MUCH more. Political biased de-funding is the worst kind of hypocrisy.

  • Robert_g896

    Recently I went through a company sponsored wellness screening. The intent maybe for the good but starting with the government people are being mislead about what is a healthy diet.There is too much corporate influence. It starts with the low fat and cholesterol recommendations. It see what I am talking about, maybe you could have another program with Alan Watson author of Cereal Killer or Anthony Colpo who wrote the book “The Great Cholesterol Con” There are many books written on this subject but to my amazement none are available at my public library. Atkins is right and I have him to thank for my excellent health at the age of 59 and looking forward to many more years.

  • Ishmael

    Michael Porter seemed to do a passable job of describing “here” (now) and OK with “there” (the goal) but it wasn’t clear how the two might be connected. Just seemed like the same old mantra: “Come on, give it more time, it’ll get better…”
    It was not obvious how it is in a capitalist’s best interest to be a good steward of anything except his or her capital inflow.
    Reich, on the other hand, seems greatly steeped in rational reaility.

  • William

    Mr. Porter thinks that the business community does nothing to help the local community? Don’t they create the community by creating a business, jobs, creating wealth? Is that not enough?

    • Catcrumb

      No, businesses don’t create community. They might be part of a community but they are only part. What you are talking about used to be called a company town.

    • Andre

      What Michael Porter means is that whatever the business community does in terms of helping the local community is rarely intended or deliberate, given that no business is ever created to help outsiders (as opposed to non-profits or foundations). Instead, what help results for the community is, so to speak, as a by-product of business activity, say, the production of widgets. If producing widgets requires creating x jobs, paying y salaries and buying z dollars worth of raw materials, than so be it. But none of these was intended as a service to the community. This not to say that business avoids or is necessarily opposed to such services to the community. It’s just that they are less of a concern to a business than to be profitable and competitive.

  • Robert Hennecke

    Modernized Craft guilds to revive Detroit and help remote areas produce goods.
    Modernized craft guilds as a means to revive Detroit and also as a means for remote areas to improve their propects for economic progress in the face of pervasive and mean spirited off-shoring mainly to the People’s Republic of China.

    The problem facing western societies is that the current existence of offshore labur on truly a massive scale is a relatively new phenomenom since the fall of the Berlin wall and the PR China’s entry into the WTO. This has allowed those companies with good contacts overseas or by hiring N. Americans from the PRC knowing the language and who to pay the inevitable kickbacks to the means of crushing their local rivals without the necessary infrastructure and or the indifference to the implications of their decision to offshore. The vast army of eager to please cheaper labour that isn’t overly concerned with the environmental degredation of their country as well as their blatant exploitation effectively doubles as a club to keep those who haven’t already lost their jobs in the west in line and is effectively morally bankrupt.

    It’s in this environment of managerial bliss that the creative individual is increasingly marginalized and his efforts often muted and in the case of Detroit an entire city. The Wal-Martization of the world means that corporations force inventors and artists to sign humiliating contracts resulting in their essentially handing over the rights to their creations for relatively little in return and without even a guarantee of long term employment with the corporations in turn off-shoring the work to China etc…: the old social contract has ceased to apply.

    There is a great deal at stake as those societies which engage wholeheartedly in creative endeavours stand to be in the best position possible to deal with the plague of off-shoring. Western de-industrialization and a falling birth rate have resulted in a surplus of industrial and educational types of buildings in remote areas (not cities as they end up becoming Condos) to be available in some parts of the world and are frequently owned by the state. My solution would be to provide these buildings to a new type of social construct called CRAFT GUILDS that would have temporary non-profit status for 3 to 5 years in order to permit them to acquire the equipment, machinery, educational liasons and the infrastructure necessary to get started and off the ground. The ideal craft guild would be an assemblage of architects, engineers, artists and production technicians who would enter upon mutually beneficial contracts respecting their individual rights and not excessive in their demands and allowing for both horizontal and vertical growth. It would be unwise to limit this idea to merely arts and crafts and furniture etc… as I see this idea being applicable to the full range of economic activities especially high technology activities such as electronic production and pharmaceutical production and could allow western societies to effectively compete against the military dictatorship that is the PR China.

    Patents, copyrights and designs would be owned by the their creators with a 10 % royalty fee for the first invention reverting to the guild in order to enable the continuity of the guild’s existence. Guild types can cover the entire spectrum of creative activities but the special status of the modernized guilds would be dependant upon their being engaged in CREATING goods and or services that are not readily available and not simply being job shops which in reality would have them compete with existing companies and merely be subsidized competition and would in effect be moving work from one entity to another. It should also be an objective of the guilds to disavow any government assistance whatsoever for the building and renovation assistance as donations would be tax deductible and in effect corporations would be helpfull to these entities as they will be eager to gain tax credits that could acrue from the donation to these temporary non-profit entities instead of simply scrapping fully funtional equipment. Donations in the form of machinery and construction materials which typically end up in the scrap yard would finally put to a halt the retardation of fully functional equipment being brought to the scrap yard because the tax code makes it more beneficial to declare fully functional machinery unusable through the depreciation aspect of the tax code and thus scrapping them with the supreme irony of their winding up in the PR China.

    I believe these guild can work within the capitalist system and even creates greater flexibility for it to survive and yet be more equitable with they’re simply being another construct such as the corporation or the permanent non-profit entity. Modernized guilds can offer society the benefits of invention and creative production in order to combat the flood of cheap imports produced by having limited production capabilites as part of the guilds’ structure. Prototypes, proof of concepts and short production runs in the least should be possible and even existing corporations can benefit from the concept as they can farm out their research and development to these entities. The ideal model would be something like Bauhaus type assemblage of creative people creating movements.

    Marketing can be carried out via the internet through Kijiji, cragslist, Ebay etc…. in order to bypass the lowest price is the law of Wal-Mart etc… This would permit a closed loop between the creator and the end consumer thus guaranteeing the integrity of the design and manufacturing process and at least allowing the possibility of options for consumers. A seal of the guilds approval along with details as to how the product or service was created or manufactured could be given providing the consumer that cares the peace of mind that he/she is part of the solution rather than a part of the problem. All members of the potential guilds should have a proven track record of creativity without any financial assistance completely independant of any institution so as to demonstrate the ability to think outside the box and survive with limited or even no resources as anything is possible with government handouts such as what is pervasive in Quebec, but things get far more difficult without easy handouts. This is about creativity and not getting on a gravy train, the soft life is for those hiding out in universities or think tanks pontificating as opposed to being in the front lines trying to repulse the onslaught of unethically and environmentally unsoundly produced items from the PR China, it’s tough love, sink or swim.

    The original craft guilds didn’t have a steady stream of government handouts to rely on and yet they managed to bring about the basis from which the industrial revolution sprung forth. The impact of creativity should not be underestimated as it has taken a single mother scraping by in England to being a billionaire. How many other J.K. Rowlings have yet to see their creations see light of day due to the narrow limitations of what creatively challenged managers deem will work or not. I believe modernized guilds can be a medium by which society can be enriched and the rights of the creative better promoted and protected. This way the current prevalence of societies begging and bribing corporations to invent things and employ people in the western world when in reality they are merely re-inventing the wheel and buying off the shelf items instead of doing “actual” research and development can be offset by a system that gives little but receives a great deal. Large corporations are getting money from all levels of government on the pretense they are developing with the intent to produce locally but there is enormous off-shoring of even what little research is actually done, how much of this is copied and pasted from utside sources and called Canadian research and then asking for the handouts. The entire structure of how corporations take advantage of government handouts is nothing short of scandalous with the likes of Bombardier, Pratt & Whitney, General Electric, Rolls Royce et-al leading the way. Large corporations talk a good game about free market capitalism but they are so hooked on government steroids that they are very far removed from free market capitalism and there needs to be injected into the system a grass roots people serving system to counter the callous indifference of global capitalism and it’s pathetic junky and mafia (in terms of who they hire) like moralities regarding their crass pitting of one jurisdiction against another for the purposes of extracting the biggest handouts. This is far removed from the capitalism of the 1960′s and beforehand, it’s what I call extortion: give us handouts or we’ll move the plant to China, give us excessive research and development handouts even though there are no noticeable differences in product development of processes etc.. and give us interest free or no interest loans that more likely than not will not be repaid. The system is severely corrupted as to make it a jury rigged assemblage of incoherant and conflicting messages that are sent to people as to how they can be truly effective and constructive citizens. Thanking you in advance for your consideration, Robert Hennecke.

    • Strefry

      Wow! You really have thought about this. It’s funny how some of the most workable ideas were designed to serve the group and not the individual. I wonder if social networking could move this concept forward, much like it moved Egypt forward? Where is the “tipping point” (thanks, malcom G). Sharonlee Trefry

      • Robert Hennecke

        Thank you very much. If you ever wanted to have more information you can email me at falconlake@yahoo.com.
        There are working examples of this to a certain extent in the Basque region of Spain called the Mondragon co-ops that were started by a jesuit monk to help alleviate poverty in that region in the 1950′s. There are currently at least 53 000 in that co-operative and they make CNC machinery and buses and wine and even have a technical college, all worker owned. One worker, one vote. These types of entities are not easily off-shored.

  • Jayco

    We need a whole new generation of people devoted to destroying corrupt capitalism!! Not willing to accept payoffs!! Willing to do what’s right for us as a community not a marketplace!! To not let capitalism destroy those that do not understand how to survive under it!!

  • Julie

    Michael Porter is wrong, wrong, wrong when he says the low income segment has been ignored as market. The financial services industry has been busily wringing every cent possible from this population for years.

    I have been friends with a low-income, poorly-educated family for 20 years. I remember when they were showered with credit card offers; a few years later someone seriously tried to sell them a subprime mortgage; for the past few years they’ve been in the clutches of the payday loan industry.

    This was called USARY when I was younger. We simply must regulate the financial industry to keep them from preying on people.

    • Andre

      Michael Porter isn’t wrong. The low income segment has been ignored as market by most except the predatory lenders that have inundated it with subprime mortgages, credit card offers and payday loans at usurious rates.

  • ulTRAX

    DEAR ON POINT: While it’s nice to have posts linked into a coherent discussion, this new forum system is dreadfully slow and clearly can’t handle the traffic. It can take 60-90 seconds to load this page… and 20-30 seconds for the POST pop-up… and that’s with hi-speed DSL.

    • ulTRAX

      Make that 120 seconds to load the page with all the posts. Clearly this is a red flag that the page code is bloated or your servers can’t handle the traffic.

    • Clodene

      Had to switch to Firefox as IE 8 crashed three times.

    • The-truth-seeker

      I have switched to Opera but I have heard Google Chrome is also very fast.

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  • Seldoc

    I agree with Mr. Porter that it makes sense for businesses to look reduce costs wherever and whenever possible. So, if they can generate more profits by finding local suppliers instead of using foreign ones they will. They’ll also develop local markets if they can. This, however, begs the questions that, if they do indeed generate more profits by taking the actions, he suggests, what is going to cause them to share the bounty of these efficiencies with their employees, and what is going to cause them not to use the threat, either real or perceived, of off-shoring jobs to suppress their costs of labor?

    • Andre

      That’s where Robert Reich comes in with his proposition for the government to bypass business in arranging for trickling down more income to the workers. His premise is that the middle-class has become so poor due to increasing income inequality that it can no longer absorb its share of the goods and services that the nation produces. So he advocates a sort of EIC (Earned Income Credit) system whereby workers earning say $50 K would be paid a $40 K EIC by the IRS. This would be financed by revenues brought in an explosion in demand that would drive the economy and job creation. Even the wealthiest would be better off and end up with more after-tax income than under the present maximum tax of 35%.

      • Ralph

        Andre, do you have any idea what you are talking about? I
        doubt it. Mr. Reich has never proposed anything of the sort. All he advocates
        is that there should be a level playing field. Do not tilt the whole game
        toward the upper 20 Percentile. Is that such a bad position to take?

    • Andre

      Corrected: That’s where Robert Reich comes in with his proposition for the government to bypass business in arranging for trickling down more income to the workers. His premise is that the middle-class has become so poor due to increasing income inequality that it can no longer absorb its share of the goods and services that the nation produces. So he advocates a sort of EIC (Earned Income Credit) system whereby workers earning, say, $50 K would be paid a $40 K EIC by the IRS. This would be financed by revenues brought in by means of higher taxes on the wealthiest. Reich expects this would lead to an explosion in demand that would drive the economy and job creation. Even the wealthiest would be better off and end up with more after-tax income than under the present maximum tax of 35%.

  • Zeno

    Hey this guy sets a good example: http://www.youtube.com/watch?v=r8ATOARgLO8

    We will never see this here.

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  • Macasavm

    Poor Mr Porter, definitely a student, not a worker. He misses the point. He still believes that the answer is on the Company/Corporation and not the people. At best idealist, at worst naive and disingenous.

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  • Jarod

    I think google has it right- “Don’t be Evil”

  • Bob

    I am that lay person who feels anger towards “big business”. It looks to me as if capitalism by design tends to concentrate resources, wealth, money. It flows from the many to the few if the capitalist is successful.
    The fact that capitalist “compete” for limited resources is a bad model with troubling incentives and consequences.

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  • PKCHICAGO

    Hopefully Porter is not titling at windmills but his task is made all the more difficult given the type and backgrounds of the students he has been given to work with. True at Harvard, or Chicago, or Michigan or Stanford. These young adults are paying huge sums for tuition at “university” programs that have essentially become technical schools. The students are greatly damaged goods before they get there and like Lyndon Johnson said “you can’t make chicken salad out of chicken s..t”. How, otherwise does one explain the mostly blind acceptance of the uni-dimensional focus of the B-schools on profit “maximization”. Why question it once you’re in the B-school factory since there are no other metrics used to gauge? Once out, forget about it – you’re brainwashed. Even if the admissions offices were told to find the input amongst those schooled or grounded in the ethos of good, justice, virtue, humanism and oh my gosh, even communalism, Porter’s colleagues would not know how to handle them and the placement offices could not satisfy the recruiters. Again, hopefully Porter finds traction but in the near term let’s recognize what B-schools have become. They are trade schools, technical factories that take product inputs and turn them into one-dimensional cogs in the process of making profits for profit’s sake.

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  • Nick

    When is American going to have its own revolution and over throw the Plutocracy that is ruining this country?

  • geffe

    With apologies to Robert Reich, but this article hits the nail on the head.

    The Republican Strategy
    By Robert Reich

    Thursday, February 17, 2011

    The Republican strategy is to split the vast middle and working class – pitting unionized workers against non-unionized, public-sector workers against non-public, older workers within sight of Medicare and Social Security against younger workers who don’t believe these programs will be there for them, and the poor against the working middle class.

    By splitting working America along these lines, Republicans hope to deflect attention from the big story. That’s the increasing share of total income and wealth going to the richest 1 percent while the jobs and wages of everyone else languish.

    Republicans would rather no one notice their campaign to generate further tax cuts for the rich – making the Bush tax cuts permanent, further reducing the estate tax, and allowing the wealthy to shift ever more of their income into capital gains taxed at 15 percent.

    The strategy has three parts.

    The battle over the federal budget.

    The first is being played out in the budget battle in Washington. As they raise the alarm over deficit spending and simultaneously squeeze popular middle-class programs, Republicans want the majority of the American public to view it all as a giant zero-sum game among average Americans that some will have to lose.

    The President has already fallen into the trap by calling for budget cuts in programs the poor and working class depend on – assistance with home heating, community services, college loans, and the like.

    In the coming showdown over Medicare and Social Security, House budget chair Paul Ryan will push a voucher system for Medicare and a partly-privatized plan for Social Security – both designed to attract younger middle-class voters.

    The assault on public employees

    The second part of the Republican strategy is being played out on the state level where public employees are being blamed for state budget crises brought on by plummeting revenues. Republicans view this as an opportunity to gut public employee unions, starting with teachers.

    Wisconsin’s Republican governor Scott Walker and his GOP legislature are seeking to end almost all union rights for teachers. Ohio’s Republican governor John Kasich is pushing a similar plan in Ohio through a Republican-dominated legislature. New Jersey’s Republican governor Chris Christie is attempting the same, telling a conservative conference Wednesday, “I’m attacking the leadership of the union because they’re greedy, and they’re selfish and they’re self-interested.”

    As I’ve noted, this demonizing of public employees is premised on false data. Public employees don’t earn more than private-sector workers when you take account of their education. To the contrary, over the last fifteen years the pay of public-sector workers, including teachers, has dropped relative to private-sector employees with the same level of education – even if you include health and retirement benefits. Moreover, most public employees don’t have generous pensions. After a career with annual pay averaging less than $45,000, the typical newly-retired public employee receives a pension of $19,000 a year.

    Bargaining rights for public employees haven’t caused state deficits to explode. Some states that deny their employees bargaining rights, such as Nevada, North Carolina, and Arizona, are running big deficits of over 30 percent of spending. Many states that give employees bargaining rights — Massachusetts, New Mexico, and Montana — have small deficits of less than 10 percent.

    Republicans would rather go after teachers and other public employees than have us look at the pay of Wall Street traders, private-equity managers, and heads of hedge funds – many of whom wouldn’t have their jobs today were it not for the giant taxpayer-supported bailout.

    Last year, America’s top thirteen hedge-fund managers earned an average of $1 billion each. One of them took home $5 billion. Much of their income is taxed as capital gains – at 15 percent – due to a tax loophole that Republican members of Congress have steadfastly guarded.

    If the earnings of those thirteen hedge-fund managers were taxed as ordinary income, the revenues generated would pay the salaries and benefits of over 5 million teachers. Who is more valuable to our society – thirteen hedge-fund managers or 5 million teachers? Let’s make the question even simpler. Who is more valuable: One hedge fund manager or one teacher?

    The Distortion of the Constitution

    The third part of the Republican strategy is being played out in the Supreme Court. It has politicized the Court more than at any time in recent memory.

    Last year a majority of the justices determined that corporations have a right under the First Amendment to provide unlimited amounts of money to political candidates. Citizens United vs. the Federal Election Commission is among the most patently political and legally grotesque decisions of our highest court – ranking right up there with Bush vs. Gore and Dred Scott.

    Among those who voted in the affirmative were Clarence Thomas and Antonin Scalia. Both have become active strategists in the Republican party.

    A month ago, for example, Antonin Scalia met in a closed-door session with Michele Bachman’s Tea Party caucus – something no justice concerned about maintaining the appearance of impartiality would ever have done.

    Both Thomas and Scalia have participated in political retreats organized and hosted by multi-billionaire financier Charles Koch, a major contributor to the Tea Party and other conservative organizations, and a crusader for ending all limits on money in politics. (Not incidentally, Thomas’s wife is the founder of Liberty Central, a Tea Party organization that has been receiving unlimited corporate contributions due to the Citizens United decision. On his obligatory financial disclosure filings, Thomas has repeatedly failed to list her sources of income over the last twenty years, nor even to include his own four-day retreats courtesy of Charles Koch.)

    Some time this year or next, the Supreme Court will be asked to consider whether the nation’s new healthcare law is constitutional. Watch your wallets.

    The strategy as a whole

    These three aspects of the Republican strategy – a federal budget battle to shrink government, focused on programs the vast middle class depends on; state efforts to undermine public employees, whom the middle class depends on; and a Supreme Court dedicated to bending the Constitution to enlarge and entrench the political power of the wealthy – fit perfectly together.

    They pit average working Americans against one another, distract attention from the almost unprecedented concentration of wealth and power at the top, and conceal Republican plans to further enlarge and entrench that wealth and power.

    What is the Democratic strategy to counter this and reclaim America for the rest of us?

  • Anonymous

    I wish Robert Reich were not so short, so he would have a serious chance to run for President. You know America, you have to look the part.

  • Tim Elston

    After listening to this show a few days ago, I was heartened to read in the New York Times about actual cases of what Mr. Porter is advocating. http://www.nytimes.com/2011/02/22/business/global/22pepsi.html?hp

  • Pingback: Democratic socialism workable in the U.S.? - US Message Board - Political Discussion Forum

  • jc

    It is definitely an encouraging change from the norm. I hope it will resonate in our corporate world.

  • Jonathan Carr

    How about fixing capitalism by removing the money commodity, using the internet to coordinate trade, and making it more democratic?  http://www.fixingcapitalism.com/book.html

  • Pingback: Fixing Capitalism: Michael Porter And Robert Reich - US Message Board - Political Discussion Forum

  • http://banicki.biz steve banicki

    We have lost track of what is capitalism.

     

    Capitalism is broken and needs fixing or must
    be further regulated t0 protect the consumer and worker from oligopolies. This
    is directly related to the inequality of income in this country.  If we
    desire to fix inequality, we must fix capitalism.

    The United States was founded on the principle
    that everyone is born with the right to life, liberty and the pursuit of
    happiness. Early on our forefathers decided the best economic model to reach
    these pursuits was capitalism. Free markets was chosen to  best attain the
    nations  economic objectives. Capitalism is here to serve society. Society
    is not here to serve capitalism.  Read More:   http://goo.gl/z0v7p

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