Stakeholder capitalism undermines American values

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Jeep Wranglers at the Chrysler Jeep Assembly plant in Toledo, Ohio, in 2018. (Rebecca Cook / Reuters)

How Stakeholder Capitalism Undermines American Values.

FWhere human flourishing happens, the old adage is true: it takes a village – families, communities and nations. The shape of the village, however, makes all the difference. Today we have villages in many different forms, from atheist collectivist communities to Judeo-Christian communities. These villages range from statist to localist.

American corporations are a prime example of the phenomenal benefits of global human development from organizations based on freedom. Yes, there are corrupt businesses, but well-functioning markets and democratic political systems will quickly eliminate these bad actors. The real counterexample of the vast human suffering based on slavery in statist countries and obligatory engagement with state-owned enterprises should be sufficient evidence to rule out the obligatory form of the village. Sadly, there appears to be a concerted effort to quickly move the United States away from localism towards statism.

The word corporation is derived from the Latin meaning “to combine into one body”. The history of the companies spans ancient Roman law and the beginning of the modern period, with shipping companies such as the Dutch East India Company. After corporate liability was limited in many countries around the mid-1800s, the modern corporate framework was born.

A key characteristic of modern business is the freedom to engage with it through funding, employment, or other arrangements. Like so many other activities in free societies, people do not have to join a business or buy its products; they do it willingly. In the United States, the First Amendment prohibits Congress from “shortening.” . . the right of the people to assemble peacefully. . . . “This right enables creators, innovators, financiers and workers to come together voluntarily as part of a society. From pandemic vaccines to space exploration efforts, businesses are a vector of human ingenuity.

It is essential to perceive the economic potential as it really is. In 1982, Warren T. Brookes wisely observed: “Our economic future is not now and has never been linked to the physical assets we see now, but to the vast untapped potential of creative thinking – the metaphysical process that can show us entirely new reserves. and new and easier ways of doing things, increasing value and increasing wealth without depleting our planet. Human development is best achieved when creative people can come together freely, often within the framework of the company.

Unlocking creative thinking is one of the keys to human development, and the volunteer village is the best approach. Oppressive statism and compulsory structures have long undermined human creativity. Against the backdrop of the heavy yoke of legalism, the apostle Paul urges: “For freedom, Christ has set us free; therefore stand firm and do not submit yourselves to the yoke of slavery. Biblical freedom is at the very heart of the great American experiment and compared to other experiments, notably atheistic Marxism. The proof is clear: freedom dominates slavery.

From improvements in product quality to innovations in services, the free market dominates in part thanks to the pent-up creativity of innovators. Allowing creators to come together on whatever voluntary arrangements they want is the key to a healthy economy. Winston Churchill wisely observed: “Among our socialist adversaries there is great confusion. Some of them see private enterprise as a predatory tiger to be slaughtered. Others see him as a cow they can milk. Only a handful see him for what he really is: the strong, willful horse that pulls the whole cart. Note that volunteer horses make strong horses; as a result, volunteer creators are making amazing innovations that benefit many villages.

It is time for business leaders to abandon their efforts towards a global corporatocracy that stifles the very creativity that has brought so much human flourishing in recent centuries. Let us return to allowing the democratic political system to establish its own property rights and a clear rule of law. Business leaders must focus on rebuilding a culture of trust by primarily serving their shareholders through creative innovations that result in higher quality products at better prices. In this way, the volunteer village flourishes as well-run companies gain additional capital and repeat the cycle of innovation. Let us therefore resist any attempt to denigrate the First Amendment of the American Constitution.

As Jürgen Habermas noted, the foundation of Western civilization is the direct legacy of the Judaic ethics of justice and the Christian ethics of love. Within this framework, if the First Amendment is preserved, then unleashed human creativity will be unprecedented in human history, benefiting even the least in our volunteer villages.

Robert Brooks, Ph.D., CFA is the founding partner of Blue Creek Investment Partners, LLC and President of Financial Risk Management, LLC. He is a member of the 2ndVote Supervisory Board and the 2ndVote Advisory Board of Advisors.


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