In these times, business as usual is bad business


January 16, 1991|By PHILIP MOELLER

Half a world away, hundreds of thousands of Americans (and even greater numbers of Iraqis, other Arabs, Israelis and Europeans) are spending some of the loneliest and longest nights of their young lives.

Here, millions of relatives and friends have, in recent days, been slapped with the sobering reality that their loved ones may be putting their lives on the line.

Any "G.I. Joe" feelings of boisterous adventure have been put away; war is not a child's fantasy but an adult's nightmare.

Against such a backdrop, "business as usual" is a ludicrous concept. There is no "usual" today. That much, at least, is clear.

That clarity, emerging from the stark choices presented by war, is lacking in many of the other pressing issues that face us. We are also waging, and arguably losing, many other wars:

War on Poverty.

War on Drugs.

War on Crime.

War on Substandard Education.

War on Industrial Decline.

War on Pollution.

Business as usual is a ludicrous concept here, too, yet we tolerate it every day. We can afford to. We know we'll wake up tomorrow and things will be pretty much the same as they are today.

Of course, the effects of 10 to 20 years of imperceptible daily change do mount up, don't they? Who can argue that the quality of life for most people is better today than in 1970? Who can look at our institutions and not see cracks too wide to be plastered over? Who can look at society's human and natural resources and not wonder at how badly we're squandering them?

The first step toward dealing with these issues is to recognize that we are in a crisis every bit as important as the one unfolding in the Middle East.

The related second step is to realize that "business as usual" is a prescription for disaster -- or continued disaster, if you feel strongly about the kind of job we've been doing. Recession or not, things have to change.

The paramount issue for business, a k a the private sector, thus becomes whether it should become more socially conscious or, ironically, less.

Economist Milton Friedman, a Nobel laureate for work I will never be smart enough to understand, got caught up in the 1960s and 1970s in the debate over corporate responsibility.

No one's views are this simplistic, but Mr. Friedman was made to be the bad guy for suggesting that a business' sole responsibility was to make as much money as it could.

If all businesses seriously adopted such an approach, it's clear that the level of innovation and competition would soar (unless, of course, executives figured that the best way to maximize profits was to sit down together and fix prices and market shares). Society would be much, much better off.

Given the tenor of those times, with rosebuds sticking out of gun barrels and environmental protesters taking over corporate chairmen's offices, Mr. Friedman's ideas were made into rhetorical flash points for an attack on corporate greed and personal avarice.

Here is what Mr. Friedman said in his 1962 book "Capitalism & Freedom." This is not a sound bite, so please bear with him (and me):

"The view has been gaining widespread acceptance that corporate officials and labor leaders have a 'social responsibility' that goes beyond serving the interest of their stockholders or their members. This view shows a fundamental misconception of the character and nature of a free economy. In such an economy, there is one and only one social responsibility of business -- to use its resources and engage in activities designed to increase its profits so long as it stays within the rules of the game, which is to say, engages in open and free competition, without deception or fraud. Similarly, the 'social responsibility' of labor leaders is to serve the interests of the members of their unions.

"It is the responsibility of the rest of us to establish a framework of law such that an individual in pursuing his own interest is, to rTC quote Adam Smith again, 'led by an invisible hand to promote an end which was no part of his intention. Nor is it always the worse for the society that it was no part of it. By pursuing his own interest, he frequently promotes that of the society more effectually than when he really intends to promote it. I have never known much good done by those who affected to trade for the public good.'

Baltimore Sun Articles
Please note the green-lined linked article text has been applied commercially without any involvement from our newsroom editors, reporters or any other editorial staff.