Contemporary Capitalism - Essay Example

Compare and Contrast: Contemporary Capitalism Introduction Progress is continuous, and one of the biggest things that progress affected positively is business. Today, people see large corporations becoming even larger. Despite the decline in the economy during the Recession, these big conglomerates are continuously pushing for their way up. This is all for the love of profit. While corporate social responsibility may have always been a source of earning “brownie points,” there are current overlooked, sidestepped, or just plain tolerated situations that show how this supposed corporate value is not really doing its job after all. Corporate social responsibility is a big obligation especially of these conglomerates who profit through societies and people “who through their labor make capital productive” (Korten 30). This means that businesses should look at giving back to the society it benefits from. This also means that that “one percent of American society [who] owns nearly 60 percent of corporate equities and nearly 40 percent of the total wealth of this nation” (Hawken 111) should make it a point that the environment for the remaining 99 percent is not disrupted by their businesses. Two articles, one by Paul Hawken entitled “Private Lives and Corporate Rights” and the other by David Korten entitled “A Real-Market Alternative” discuss points that can easily be considered as issues regarding corporate social responsibility due to contemporary capitalism, and how the current economic system continues to fail people and the environment. Overview of the Articles Private Lives and Corporate Rights The author, Paul Hawken, discusses the the controversial issue on the influence of big businesses to the government policy-makers. For example, he states that: The Clean Air Act originally contained provisions that would reduce toxic emissions from refineries. Chevron and other oil companies fought for a less severe provision for their own refineries...Another way Chevron furthered its agenda was through a $95,000 contribution to the nonprofit American Enterprise Institute (AEI)...Exxon, General Electric, and other large polluters also pitched in. AEI issued scholarly papers backed by economic data that showed more stringent clean air standards to be “cost-ineffective.” (Hawken 112) This is just one of the examples that Hawken discusses in the chapter. He presents a solid basis for insightful discussions on what is currently happening and how to change it for the better. It is really disturbing how conglomerates are able to lobby for their interests. Another example is this: Philip Morris, Inc. Had channeled $17 million of “charitable gifts” to the pet charities of legislators in order to gain their support in defeating anti-tobacco legislation...documents cited efforts to buy silence, to “give where there is political benefit, and to develop political clout.” (Hawken 113) On a personal standpoint, Hawkens work is a deep analysis of the current capitalist industry. While the points stated are obviously bothering, the recommendations that the author presents provide hope that there is still something that can be done about it. Overall, the article presents to readers the many destructive facets of business practices that lack the so-called ethics. A Real-Market Alternative David Kortens article, on the other hand, provides an analysis of the differences between the high-end capitalism of Wall street versus the healthy market economy of the Main Street. The Wall Street economy is built and managed by big businesses who are all for the profit, regardless of how it is achieved. “By Wall Street ethics, greed is a virtue and sharing is a sin” (Korten 31). Come to think of it, a big part of the nations population falls within or under the poverty level, while at the same time, bailout money flows out from the government funds to salvage Wall Street businesses. Aside from these funds not going to the hands of the more needy citizens, the expenses incurred for this bailout will be paid by the very people it was denied to. If this process goes on, there will be a further decline in the standard of living, which will just push further the chances of natural resources and wealth going into the hands of these privileged few. With this current situation, Korten implies that the whole capitalist system is not really working to serve the people it benefits from. This is why the author recommends a healthier market economy that would, if not stop this destructive process, at least balance it for the benefit of the majority. According to the author: Main Street economy is comprised of local businesses and working people who self- organize to provide livelihoods for themselves, their families, and their communities producing real goods and services in response to community needs. (Korten 29) This system, if effectively developed, will democratize and decentralize finances so that the means to create and allot funds will be in the hands of communities, or of businesses that are not Wall Street level. This is turn will make these businesses accountable to the local people and will be more devoted towards serving the needs of the community. Natural Capitalism? An article by Michael Albert entitled “Natural Capitalism?” critiques Hawkens article discussed above. It is stated that: Hawken fails to recognize that each individual plant is not in the business of doing good for consumers, much less for society, but is in the business of making a profit for its owners and maintaining their dominant position, and that each business will continue to do this with a vengeance (or go out of business), short of being redefined into an entirely new mold, or coercively restrained. (Albert) Additionally, the article states that: Allocation to waste and warfare instead of social wages and welfare does not happen because capitalists are sadists or mired in some outdated mindset of the past. They do not spend money on useless missiles, or on systems to thwart their workers’ initiative, or on cleaning up preventable messes. (Albert) Furthermore, Albert argues that “there is no way that they [businesses] are interested in seeing all these funds applied to mitigating social ills.” This is tantamount to saying that giving the society what they deserve will weaken the capitalist system where these businesses thrive in --- and that they do not want that because it will change the balance of power between capitalists and laborers, which in turn would deprive these businesses of their profits --- the very reason they are in the business for. On a certain perspective, and in all fairness, Albert does seem to have a point. Businesses are created for profit, and not for charity work. To thwart the possibility of earning profits would mean to kill the concept of business after all. The next question here would be, is this will be the system, who would want to put up a business? Making Money, Yet Growing Poor An article by David OKelly entitled “Making money, Yet Growing Poor,” on the other hand, supports Kortens article above. Thr author first introduced Kortens background to ensure the readers Kortens credibility in this subject. He shows his support to Kortens article by stating that: One of the most powerful of these lessons is the analogy of capitalism as a cancer within the global body. Like cancer cells, capitalism overcomes the bodys natural rejection mechanisms by disguising itself as being a normal and integral part of the body. So nobody questions the money system. We accept our money system as being normal. (OKelly) OKelly also supports Smiths theory of modern market that “markets, to be efficient and effective, should be based around small, locally-owned enterprises” (OKelly). On a personal viewpoint, the most interesting analogy that OKelly makes in his article is that capitalism is for the wealthy, while “healthy markets are life-based and have as their purpose the employment of available resources to meet the basic needs of humanity.” Therefore, if the majority of the now consumers would think of pushing this healthy market for expansion and progress, maybe a more fair balance will ensue between the power of the capitalists and the power of the laborers. OKelly points out that the mission of concerned markets should be focused on rules that are based on life and the environment, and not solely based on money. He points out too that even individual born in the planet has a fair share of his or her part in the world, and capitalists should not be allowed to deny these people of these inherent rights. It could be true that local markets may have more sense of moral responsibility and community interests. Analytical Discourse All articles agree at one point: capitalism is about money. Advancing that goal may come in the form of lesser concern for the society, the environment, up to bribery and corruption. Even Albert, in his article, does not deny that capitalists are there for the promise of profit. However, the major difference of his article is that he believes that this is the norm, and that it should not only be expected, but also tolerated. The three other articles by Hawken, Korten, and OKelly refuse to accept this concept. Even though the three articles may have different positions in changing the way businesses are handled nowadays, they are all towards one goal --- benefit for the society and the environment. This may seem an unfamiliar concept for many, but it is quite grounded on basic common sense. Hawken argues that people tolerate the lack of corporate social responsibility of these conglomerates. The major reason here is that people, the laborers, depend on these companies for livelihood. Corporations such as Exxon, General Motors, Philip Morris, and American Stores must have at least several hundred of thousands of employees working for them. If the bigger part of the population benefits from these companies, it is no wonder why it is easy to turn a blind eye to what is happening. It is just normal for these people to think that the success of these companies also means their success, and that the downfall of these companies would mean their unemployment. This is normal to human nature. The good thing about this is that aside from the recommendations that Hawken provides in his book chapter, Korten provides a more viable solution --- more viable because while Hawkens recommendations are based on the integrity of conglomerates, Kortens solutions are based on the market itself. If more and more people would support the idea of the main Street system, and more and more people would follow its tracks, then there is hope that balance of power will ensue. There is no need for one to depend on the goodwill of these corporations to act to change the business system for the market. The market itself can start doing it on their own, with a goal towards better life and environment. Surely, a local store will be more concerned with the community it belongs to compared to large companies with over 500 branches across the nation. Albert states that it is impossible to expect businesses to do something that will endanger the possibilities of larger profit. However, on a personal viewpoint, it is not impossible to push people towards a healthier market system. This is not to say though that what Albert points out in his article is wrong. However, the idea is too bleak, and that embedding in the minds of the people that nothing can be done about the situation is like accepting that the system will forever stray from the ideal, endangering not only the concept of ethics, but also the environment. This type of thinking is a good example of OKellys stance regarding the analogy of capitalism, that it is like cancer cells that fuses itself in the system, enabling it to hide under the label of “normal.” While it may be true and while it may really be happening, one still needs to look for ways to cure it. To be fully accepting and tolerant of all things, and to be anything less than wanting improvement is not healthy or normal. Works Cited Albert, Michael. Natural Capitalism? Z Magazine, n.d. Web. 6 February 2012. Hawken, Paul. The Ecology of Commerce: A Declaration of Sustainability. New York: Harper Business, 1993. Print. Korten, David C. Agenda for a New Economy: From Phantom Wealth to Real Wealth. San Francisco: Berrett-Koehler Publishers, 2009. Print. OKelly, David. Making Money, Yet Growing Poor. Feasta Review, n.d. Web. 6 February 2012. Read More