Introduction

The modern world is a very different place than the world of even our recent ancestors. 

Around 1915, my grandfather rode a horse 30 miles to a railroad station and then took a train to Dallas to visit the Texas State Fair. The most wondrous thing that country boy saw on his voyage was not the Indian Ball players, which he didn’t mention. Instead, it was his first glimpse of an electric light bulb. He enjoyed telling us - many times - of how he had to lace his boot over the bare light bulb hanging from a cord from the ceiling in his hotel room so he could sleep. He had no idea how to turn it off, and he was too embarrassed to ask the sophisticated, big-city desk clerk for help. Nothing remains now of that hotel or of that whole area of Dallas except a few fading photographs.

His father came from Tennessee in a horse-drawn wagon to Texas, looking for land. He was a homesteader who scraped the forest from virgin land in East Texas so it could be plowed and planted for the first time. Though my mother and her sister spent many barefoot summers on the farm that he created from nothing, they cannot find it now because nothing remains of it - not the wagon that he drove to Texas, not the dirt roads that carried his crops to market, not the house he built with his own hands, not the fences he strung, not the barn his neighbors helped him build, nothing. It has been all covered over by the people who came later. The life’s work of the homesteader and his neighbors has all disappeared.

That homesteader’s father fought in the Civil War. My grandfather told me stories that that his grandfather told him about those days, though none about the War. They were mostly about the adventures of a hunting dog named Blue - the marvel of the county - and the personality quirks of long-dead relatives. Very little has survived from those days either: a few books in libraries, some museum antiques, a few houses, and many tombstones.

The worlds of my grandfathers have completely disappeared. Like that East Texas forest, they have been scraped away as if they had never existed. “So what?” you ask. “Every generation replaces the previous one. Besides, what has all this to do with the corporation?” Those are good questions. Be patient with me through one more grandfather story and I will reveal my point.

My grandfather mourned the disappearance of the world in which he grew up. Like anyone else, he missed those good people whom he had loved and who had died over the years. Additionally, though, he told me that many of the good things that he had come to cherish were replaced by other things that were of less value. Dirty air replaced clean air. Dirty water replaced clean water. A frantic pace of life replaced a relaxed pace of life. The wildlife of the region had noticeably diminished. Scoundrels regularly took advantage of honest people. Dangerous cities replaced safe villages.* 

He also made a much more profound point - one which took me decades to appreciate. My grandfather was a technologist of his time: an automobile mechanic who started working on Model T’s and spent the rest his life repairing machinery of all kinds. He was not a grease-monkey but a skilled craftsman who could use a forge, a lathe, and hand tools to build replacement parts as needed. He was also an inventor of modest accomplishments. He told me that he deplored the design of automobiles as they evolved through the years. Any machine, he said, should be designed to last forever. Though moving parts will always wear out, the design of the machine should allow its user to personally disassemble it and replace the worn part. Over decades, perhaps the entire machine will be completely replaced part by part, but the whole thing should never be thrown in a junkyard. A machine, he said, was not an assemblage of parts but a design. He said that a machine that was designed to wear out and be thrown away - like a car that is designed to go to the junkyard - was a violation of common sense and an offense to the intelligence of the purchaser. He also believed that selling a machine which could not be maintained by its purchaser - assuming he chose to learn how - was a form of thievery. He wondered why the machinery he worked on was not designed to last and perform for a lifetime rather than just a few years. Why had designers decided to produce lower quality products than was possible?

Being a reasonable man, he quickly acknowledged that the world of his old age had many advantages over the world of his youth. He was happy that I would never catch polio like his daughter - my mother - did, because I had been injected with Dr. Salk’s miracle polio vaccine. Coming in from the hot Texas sun and spending a moment in front of the window-mounted air conditioner was like going to Heaven. Western movies with plenty of gun play and horseback derring-do were the ultimate pinnacle of art, giving the common man a chance to enjoy high culture. The affordable tractor had transformed the lives of the farmers who lived around him. Most of all, he believed that hand-held power tools were God’s greatest gift to humankind; with them any man could make any thing and keep it working forever.

Here we come to the point. The worlds of my grandfathers are gone, scraped clean from the earth. What has replaced those worlds? 

Those worlds have been replaced with the output of America’s corporations: consumer goods, farm supplies, veterinary medicines, billboards, packing plants, factories, corporate offices, automobile dealerships, Walmarts, and the contents of Walmarts. Who decided that machinery should be designed to wear out quickly so it will be replaced quickly (thus increasing sales and earning my grandfather’s contempt)? America’s corporations. Who decided what kind of goods we would consume? Again, America’s corporations. Who taught us that the meaningless phrase “New and Improved” should make our wallets try to jump out of our pockets? Corporate marketing departments. Who has designed, manufactured, and sold you every thing in your home, your driveway, your closet, your office, your garage, and your yard? America’s corporations. Who made the western movies my grandfather so loved? America’s corporations.  Who presents you with gigantic images of tantalizing food a hundred times a day, scientifically designed to encourage you to eat and eat and then eat more - and then have dessert? Could it be America’s corporations? Who has convinced your teenage daughter that life without an ipod, hundred dollar jeans, two hundred dollar sandals, and a three hundred dollar cell phone is not worth living? Have you figured it out yet? Who has decided that your thirteen year old son should spend his days in his bedroom shooting pimps and screwing whores on his computer screen? Can you guess the answer by now? Who bribed your Congresswoman to surreptitiously insert a few carefully designed sentences into a law you will never hear of for reasons you will never know? Could it be a lobbyist working for a corporation? When you do a search for a topic on the internet, who decides which of 50,000 possible results appear at the top of the list? Do you get the point?

And finally, who do you work for? Who decides how much money you should make? 

Increasingly, modern corporations are shaping how we live and what we think. You and I should think about this special kind of organization and think about the future of ourselves and our children in a corporate world.

Corporatism

There are many ways to describe the way corporations function in our society. Let’s consider three possible descriptions.

1. Conservative rhetoricians describe the function of the corporation in this way:

• The best way to increase wealth in our society is through free market capitalism.
• The corporation is the best way to concentrate capital and focus it on the task of providing consumer goods and services. 
• The corporation’s actions are governed by its shareholders, who elect a board of directors to keep its management honest. No corporation, therefore, would do anything contrary to the interests of its shareholders.
• The corporation’s products are controlled by its consumers, who “vote” with their dollars for its products or those of a competitor. No corporation, therefore, would do anything contrary to the interests of its customers.
• The corporation must be a good employer or its employees will leave, thus “voting” for the best employer. No corporation, therefore, would do anything contrary to the interests of it employees.
• The corporation communicates with its customers by advertising its products in print and through electronic media. This corporate speech benefits customers by making them aware of useful products which will satisfy their pre-existing needs.
• If the government interferes in any way with the free actions of corporations, then the corporate system of checks and balances doesn’t work as well. Corporate management is forced to satisfy government bureaucrats instead of corporate shareholders, customers, and employees.

The marvelous processes of the market therefore act as a set of checks and balances, guiding the corporation and limiting it to only the most benign actions. Happy employees produce desirable products for satisfied consumers. The oil which lubricates this machine is human greed. Employees want the highest salaries. Customers want the best deal. Stockholders want the greatest possible profit. Corporate executives want the biggest bonuses and the most luxurious private jets. When everyone’s greed competes with everyone else’s, efficiency is the result. Like water seeking sea level, everyone’s greed is satisfied to the maximum extent possible. Even if the system produces some undesirable results (high unemployment, economic downturns, canceled pension programs, exploitation of migrant workers with a murky immigration status, etc.), those results are assumed - by definition - to be better than those that would have been produced by any other system. The corporation may be occasionally bad, but bad is still better than worse, and every other system is worse.

Corporations describe themselves in the most superlative and benign of terms in many different ways to many different audiences. They have one message for customers contained in the text, speech, and graphics of their ubiquitous advertising. They have another message to investors. Corporations deliver still another message to voters. In fact, their rhetoric is so predictable that you could attribute the following examples to almost any corporation. 

Describing themselves ...

• Century 21 says, “We are dedicated to providing buyers and sellers of real estate with the highest quality services possible.”
  HP says: “HP is a company unlike any other.”
  Kraft Foods says, “We’ve made a lot of changes in our company, to enable us to delight our consumers and ensure that we’re a more successful business for the long term. Everything we do starts with our vision: helping people around the world eat and live better.”
  Coors says, “Coors - it's a name that conjures up an image of cool mountain streams, clear blue skies and all that is inspiring about the Rocky Mountain West. It is a name associated with an uncompromising commitment to quality - a reputation that began more than 100 years ago and thrives to this day.”
• Macys says: “After 150 years of history as one of the most recognized and loved retailers in the country, Macy's began a new life in early 2005 as ‘America's Department Store.’”
• Ford says: “Our business is driven by our consumer focus, creativity, resourcefulness, and entrepreneurial spirit. We are an inspired, diverse team. We respect and value everyone's contribution. The health and safety of our people are paramount. We are a leader in environmental responsibility. Our integrity is never compromised and we make a positive contribution to society.”

To investors, corporations have very different messages that have nothing to do with cool mountain streams, delighting customers, or helping people around the world live better.

• Kraft Foods Inc. believes its best chance for significantly boosting profit is to invent the next big thing in food and is taking numerous measures to do so, including opening a new 10,000-sq. ft. facility that houses 2,100 food scientists and engineers. Some 10 new projects this year are producing revenue at double the 2004 rate.
• Personal-computer maker Hewlett-Packard Co. on Tuesday said it will cut 14,500 jobs, about 10 percent of its full-time staff, as part of a restructuring plan designed to save $1.9 billion annually.
• The [Macy’s design] team spends thousands of hours writing computer code to embed human-like properties in the [computerized model customers] they create. The [computerized customers] are modeled on consumer research surveys and databases of information. The virtual customers in Macy's model will be given characteristics such as sex, age, how much they buy, and when, from credit records and thousands of pages of cash register data from eight Macy's stores.... By watching how they interact, the retailer hopes the system will allow it to make risk-free decisions such as:

-- The number of salespeople needed in each store department to maximize profits

-- How to turn browsers into shoppers

To voters, corporations have yet another message:

• Corporations can regulate themselves. 
• There is no need for governmental regulation in the marketplace. 
• The market has its own set of checks and balances.
• Regulation or any kind of governmental oversight will hurt the economy, lower wages, and reduce employment.

Every company is the best of its type. Every customer is delighted. Eating a half-pound burger and a pound of fried potatoes becomes a meaningful experience. Drinking beer is like hiking in the mountains. Our customers love - not just like - us. Every company seeks only to make people happier and to make the world a better place.

This is a work in progress. Want to make a comment? MidasJones@MidasJones.com

www.MidasJones.com

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