Watching this class was a walk down memory lane for me. I’ve worked and lived through all of the changes, many negative, during my career. I even sat face-to-face with a corporate head of the same tire company mentioned. Actually, it was that person who sparked my interest in Professor Reich during a work presentation so I should thank them!
I’ve watched the fall of “Stakeholder” capitalism and saw the horrific repercussions of plant closing that resulted in high unemployment, personal bankruptcies, health issues and yes, even suicides. I’ve seen strong middleclass communities fall, home values plummet and poverty skyrocket. Ironically, those who created this nightmare were the first to decry that those who were suffering were either lazy or welfare queens.
As for the roundtable, talk is cheap. Without government intervention through policy and laws, this will continue to get worse creating a population of angry American workers who will turn to authoritarian leadership out of despair. Great class, a real wake-up call!
One company-type we haven't discussed is medical insurers. They've embraced shareholder capitalism in a field where it makes no sense, ethically or morally, to be concerned with profit. The entire idea that every quarter should see an increase in profit, no matter your field, is insane. It makes zero sense. Economies ebb and flow. Contant unrestrained growth is impossible, but exactly what shareholder capitalism demands. In the case of insurance companies, this means companies are "forced" to limit and deny services in order to maintain profits. The highest return, regardless.
Yes, todays monopoly companies simply need to go to the well the american customer or worker and extract the profits they want instead of the profits the market dictates. I've watched big payouts for shareholders and CEOs and record profits as mass layoffs are occuring around me (my number isnt up...yet) Jamie Dimon CEO just claimed to want to fight wealth and income inequality. He may use those words but he wants to subsidize industry, prevent regulation oh and worker training. Its only a nod to the big problem so as Hitchhikers guide to galaxy said about the sirius cybernetics corporation execs. They would be the first against the wall when the revolution comes. Joking aside.
The idea that corporations and billonaires are going to fix wealth and income inequality is a falacy and the latest half hearted attempts are meant to stop government taxation, regulation and thought about the issue.
I was a medical auditor for two Bay Area hospitals in the 90s and, without fail, the cost of hospital medications/treatments/services went up every quarter. When questioned by me re: these increases, neither of the business managers at either facility could offer any sound justifications except to say they had to pass along their costs to insurance companies to make up for the decreased reimbursement they were receiving from Medi-Cal patients. Which basically translated to mean that those who were paying their health care premiums were getting stuck with footing the bill for everybody . . .and a bloated, inefficient, and profit-driven industry.
Money, and the stuff it can buy, rules in our world. We worship it. We are never taught to be satisfied, or content. What is that? What does that feel like? Is that enough? Until this obsession and worship of money and things is curtailed, I don't see much change.
A"passive satisfied attitude" feeds income inequality making it easy for greedy interest to reach out and grab more than their share. Now that both political parties depend on large donors to support candidates to get them elected, and lobby congress to get anything done, donating to parties just exacerbates over polarity and promotes gridlock in congress. The only way to tilt the scales back to more equity for working people in post barbarian society, where we no longer over run and behead the ruling class, is extremely tough organized labor through high solidarity unions that are strong enough to shut the money makers down if they don't comply with union wage demands, calls for windfall profit taxes, or antitrust legislation.
I'm looking forward to learning about the laws and rules that enable this selfish corporate CEO behavior. We should go back to using the term corporate raiders. "Private equity managers" sounds too benign for the damage they cause. In any case, they should be prohibited by law.
This problem doesn't affect only workers. It also affects people's ability to live in habitable rental homes. Tenants might live in an apartment building that has long had a responsible owner that maintains the property and makes all necessary repairs promptly. In states that lack strong renters' protections, predatory corporate raiders may move in for a hostile takeover, to plunder the property for maximum profit. The new landlord stops providing routine maintenance, fails to respond to repair requests, is delinquent in paying for utilities included in the tenants' rental payments, closes the management office, and cannot be contacted other than through the P.O. box designated for receipt of rental checks. This also destabilizes communities.
An element that has been left out is that of time. I am a woman (a very important point), a grandmother, a mother, a psychotherapist with a full practice. I use e-purchase because I do not have time to go the nearest shopping mall to get a book or other commodity. today there are no neighborhood small retails stores that I might be able to walk to or drive a short distance. I would also reference a book that came out in the late 80s or early 90s, "The Overworked American: The Unexpected Decline of Leisure" by Juliet Schor. It also points out that in the US, in particular, women are the most overworked, And, that is still true. There are many moments when I find your lectures/thinking very male oriented. It is women and people of color who suffer the most with our current system. Who is paying the highest price for coping with COVID? Women...loss of daycare, loss of jobs, now loss of federal assistance. s
My daughter and I are among the fortunate women. My granddaughter is at college so we are not restricted by trying to handle a small child or do education at home. Both of us can work from home. BUT, given that stores are not close, we do a great deal of our shopping by internet. When available, we will shop locally with curbside pickup. Again, a matter of time.
COVID opened up online training seminars. I have been able to get far more training than in the past. I do not have to fly somewhere, stay in a hotel or pay for meals, Yes, the local hotel and restaurants don't get my money BUT I have been able to get MORE training and become a better informed therapist for less money. That is a good trade-off in my mind., My clients benefit from my increased expertise.
You bring up important points, Diana. I plan to get into a bit more detail on how both gender and race fit into the big picture of inequality later on in the course. Please keep me posted on your thoughts.
I wish I had the money to buy in local stores. At one time I did. I have to stretch every dollar. Gross income $20,000 a year after I pay for my Medicare.
The rise in extreme income/wealth inequality correlates in time with the rise of Conservative Ideology of Greed.
This can't be a coincidence!
The question really is what political outlook and agenda sold to the American people enabled this? Counter to their practical interests?
It all started with Ronald Reagan and his "Government is the problem" message! Enabling money interests to seize the power of government for their own purpose.
Thank you Professor for an excellent class. As one who worked on the line for more than one major company, what you are saying is truly spot on. Will corporations consider the interests of their workers over their bottom line going forward? I doubt it.
I just listened to Class 2, so can only now comment after the fact. During much of the lesson, I kept thinking: "He's not addressing the elephant in the room: The laws that require corporate boards to choose your Plan A, the one the corporate raiders used to send manufacturing jobs abroad and forced workers to lose their middle class lifestyles." That is, the laws in most states that impose a fiduciary duty on those board members to make decisions for the benefit of shareholders - not workers, not the community, not the country. You mentioned "fiduciary duty" several times, but didn't explain it is a legal obligation. And then I heard you say in the last few minutes that you would be discussing these laws in the next session. Good! Because if we changed those laws to impose a fiduciary duty on corporate boards to act also for the welfare of those other "stakeholders", we would go a long way to solving the deleterious effect of the corporation business model on our society.
The Business Roundtable was stuck in system that needs changing, just the way some of the people running for office or who are in office need to sell themselves to big money and abandon the desire to value all 'stakeholders', including the workers at the base level a company. It's all about the money going to the top wealth, and not about constituents or lower paid workers.
The key point that you've made here, Laurie, is that these actors (investors, CEOs, consumers) are operating within a system. The rules of a system are designed and created, and so they can also be changed.
A little bit later in the course we'll talk about why making certain kinds of change is so hard.
Follow the money! moneyoutvotersin.org AND the power (the unjust inalienable rights and powers of corporations and their nonprofit organizations) movetoamend.org
Our system has been hacked by the Oligarchy. It was corrupted by Citizens United and related SCOTUS rulings that transferred power from the people to greedy corporate interests. We can and must restore the balance of power back to us. Please help out at moneyoutvotersin.org and movetoamend.org More doing and less talking please ♥️
If it's not the same, what is it? Thanks for the cite. I'll access it. Can someone give us a handy cite to read Fed case law including appellant and "extreme" Court opinions? Or, is your cite the answer?
It follows state rather than federal law. Sometimes there is a conflict whether to take the money and run or continue operations. A "business judgment rule" may give wide discretion to directors, courts will not second-guess the board’s decisions about what is best for the company — even when those decisions predictably reduce profits or share price.
E.G. in Delaware, the business judgement rule was used to protect directors of corporations that reduce profits and share price when directors claim this will ultimately help the corporation. In Air Products, Inc v. Airgas, 16 A.3d 48 (Del. Ch. 2011), the business judgement rule allowed directors to refuse to sell the company, although a sale would have given Airgas' shareholders a profit.
One bright spot for me after the COVID epidemic, was seeing the jobs outnumbering the applicants. Any inconvenience was worth it. Where I had worked we were always reminded that there was a line at the door waiting to take our jobs. (We were non-union). But for many of us, moving to another job meant starting at lower wages and giving up benefits like vacation time that we had worked for years to accrue. There was also the worry of “last hired, first fired”. I jumped for joy when, after COVID, workers refused to apply for jobs where they were essentially abused, underpaid, under appreciated and where benefits were practically nonexistent.
They've never made it to a major Bowl game. They've subscribing to the Benson/Rubin school of thought that says they gotta pay a lot to get the best. Lol
It is certainly is amusing. I haven't really followed the Bears lately, but, from how they were when I was a student at Cal and attended the games with my dorm-mates, I do have some idea what kind of team they were/are. I suppose hope springs eternal in the minds of the University.
Watching this class was a walk down memory lane for me. I’ve worked and lived through all of the changes, many negative, during my career. I even sat face-to-face with a corporate head of the same tire company mentioned. Actually, it was that person who sparked my interest in Professor Reich during a work presentation so I should thank them!
I’ve watched the fall of “Stakeholder” capitalism and saw the horrific repercussions of plant closing that resulted in high unemployment, personal bankruptcies, health issues and yes, even suicides. I’ve seen strong middleclass communities fall, home values plummet and poverty skyrocket. Ironically, those who created this nightmare were the first to decry that those who were suffering were either lazy or welfare queens.
As for the roundtable, talk is cheap. Without government intervention through policy and laws, this will continue to get worse creating a population of angry American workers who will turn to authoritarian leadership out of despair. Great class, a real wake-up call!
One company-type we haven't discussed is medical insurers. They've embraced shareholder capitalism in a field where it makes no sense, ethically or morally, to be concerned with profit. The entire idea that every quarter should see an increase in profit, no matter your field, is insane. It makes zero sense. Economies ebb and flow. Contant unrestrained growth is impossible, but exactly what shareholder capitalism demands. In the case of insurance companies, this means companies are "forced" to limit and deny services in order to maintain profits. The highest return, regardless.
Yes, todays monopoly companies simply need to go to the well the american customer or worker and extract the profits they want instead of the profits the market dictates. I've watched big payouts for shareholders and CEOs and record profits as mass layoffs are occuring around me (my number isnt up...yet) Jamie Dimon CEO just claimed to want to fight wealth and income inequality. He may use those words but he wants to subsidize industry, prevent regulation oh and worker training. Its only a nod to the big problem so as Hitchhikers guide to galaxy said about the sirius cybernetics corporation execs. They would be the first against the wall when the revolution comes. Joking aside.
The idea that corporations and billonaires are going to fix wealth and income inequality is a falacy and the latest half hearted attempts are meant to stop government taxation, regulation and thought about the issue.
I was a medical auditor for two Bay Area hospitals in the 90s and, without fail, the cost of hospital medications/treatments/services went up every quarter. When questioned by me re: these increases, neither of the business managers at either facility could offer any sound justifications except to say they had to pass along their costs to insurance companies to make up for the decreased reimbursement they were receiving from Medi-Cal patients. Which basically translated to mean that those who were paying their health care premiums were getting stuck with footing the bill for everybody . . .and a bloated, inefficient, and profit-driven industry.
Money, and the stuff it can buy, rules in our world. We worship it. We are never taught to be satisfied, or content. What is that? What does that feel like? Is that enough? Until this obsession and worship of money and things is curtailed, I don't see much change.
A"passive satisfied attitude" feeds income inequality making it easy for greedy interest to reach out and grab more than their share. Now that both political parties depend on large donors to support candidates to get them elected, and lobby congress to get anything done, donating to parties just exacerbates over polarity and promotes gridlock in congress. The only way to tilt the scales back to more equity for working people in post barbarian society, where we no longer over run and behead the ruling class, is extremely tough organized labor through high solidarity unions that are strong enough to shut the money makers down if they don't comply with union wage demands, calls for windfall profit taxes, or antitrust legislation.
How long will these classes be up on YouTube? Pam
As long as YouTube will have me.
Please, keep them coming. I am learning so much!
I'm looking forward to learning about the laws and rules that enable this selfish corporate CEO behavior. We should go back to using the term corporate raiders. "Private equity managers" sounds too benign for the damage they cause. In any case, they should be prohibited by law.
This problem doesn't affect only workers. It also affects people's ability to live in habitable rental homes. Tenants might live in an apartment building that has long had a responsible owner that maintains the property and makes all necessary repairs promptly. In states that lack strong renters' protections, predatory corporate raiders may move in for a hostile takeover, to plunder the property for maximum profit. The new landlord stops providing routine maintenance, fails to respond to repair requests, is delinquent in paying for utilities included in the tenants' rental payments, closes the management office, and cannot be contacted other than through the P.O. box designated for receipt of rental checks. This also destabilizes communities.
An element that has been left out is that of time. I am a woman (a very important point), a grandmother, a mother, a psychotherapist with a full practice. I use e-purchase because I do not have time to go the nearest shopping mall to get a book or other commodity. today there are no neighborhood small retails stores that I might be able to walk to or drive a short distance. I would also reference a book that came out in the late 80s or early 90s, "The Overworked American: The Unexpected Decline of Leisure" by Juliet Schor. It also points out that in the US, in particular, women are the most overworked, And, that is still true. There are many moments when I find your lectures/thinking very male oriented. It is women and people of color who suffer the most with our current system. Who is paying the highest price for coping with COVID? Women...loss of daycare, loss of jobs, now loss of federal assistance. s
My daughter and I are among the fortunate women. My granddaughter is at college so we are not restricted by trying to handle a small child or do education at home. Both of us can work from home. BUT, given that stores are not close, we do a great deal of our shopping by internet. When available, we will shop locally with curbside pickup. Again, a matter of time.
COVID opened up online training seminars. I have been able to get far more training than in the past. I do not have to fly somewhere, stay in a hotel or pay for meals, Yes, the local hotel and restaurants don't get my money BUT I have been able to get MORE training and become a better informed therapist for less money. That is a good trade-off in my mind., My clients benefit from my increased expertise.
You bring up important points, Diana. I plan to get into a bit more detail on how both gender and race fit into the big picture of inequality later on in the course. Please keep me posted on your thoughts.
I wish I had the money to buy in local stores. At one time I did. I have to stretch every dollar. Gross income $20,000 a year after I pay for my Medicare.
The rise in extreme income/wealth inequality correlates in time with the rise of Conservative Ideology of Greed.
This can't be a coincidence!
The question really is what political outlook and agenda sold to the American people enabled this? Counter to their practical interests?
It all started with Ronald Reagan and his "Government is the problem" message! Enabling money interests to seize the power of government for their own purpose.
Thank you Professor for an excellent class. As one who worked on the line for more than one major company, what you are saying is truly spot on. Will corporations consider the interests of their workers over their bottom line going forward? I doubt it.
I just listened to Class 2, so can only now comment after the fact. During much of the lesson, I kept thinking: "He's not addressing the elephant in the room: The laws that require corporate boards to choose your Plan A, the one the corporate raiders used to send manufacturing jobs abroad and forced workers to lose their middle class lifestyles." That is, the laws in most states that impose a fiduciary duty on those board members to make decisions for the benefit of shareholders - not workers, not the community, not the country. You mentioned "fiduciary duty" several times, but didn't explain it is a legal obligation. And then I heard you say in the last few minutes that you would be discussing these laws in the next session. Good! Because if we changed those laws to impose a fiduciary duty on corporate boards to act also for the welfare of those other "stakeholders", we would go a long way to solving the deleterious effect of the corporation business model on our society.
The Business Roundtable was stuck in system that needs changing, just the way some of the people running for office or who are in office need to sell themselves to big money and abandon the desire to value all 'stakeholders', including the workers at the base level a company. It's all about the money going to the top wealth, and not about constituents or lower paid workers.
The key point that you've made here, Laurie, is that these actors (investors, CEOs, consumers) are operating within a system. The rules of a system are designed and created, and so they can also be changed.
A little bit later in the course we'll talk about why making certain kinds of change is so hard.
I am looking forward to the discussion. Since money is the root of all evils, I bet certain kinds of change is hard has to do with money.
Follow the money! moneyoutvotersin.org AND the power (the unjust inalienable rights and powers of corporations and their nonprofit organizations) movetoamend.org
Our system has been hacked by the Oligarchy. It was corrupted by Citizens United and related SCOTUS rulings that transferred power from the people to greedy corporate interests. We can and must restore the balance of power back to us. Please help out at moneyoutvotersin.org and movetoamend.org More doing and less talking please ♥️
“Modern corporate law does not require for-profit corporations to pursue profit at the expense of everything else, and many do not.”
https://caselaw.findlaw.com/us-supreme-court/13-354.html
Follows state law. Serving shareholders’ “best interests” is not the same as either maximizing profits, or maximizing shareholder value.
If it's not the same, what is it? Thanks for the cite. I'll access it. Can someone give us a handy cite to read Fed case law including appellant and "extreme" Court opinions? Or, is your cite the answer?
It follows state rather than federal law. Sometimes there is a conflict whether to take the money and run or continue operations. A "business judgment rule" may give wide discretion to directors, courts will not second-guess the board’s decisions about what is best for the company — even when those decisions predictably reduce profits or share price.
E.G. in Delaware, the business judgement rule was used to protect directors of corporations that reduce profits and share price when directors claim this will ultimately help the corporation. In Air Products, Inc v. Airgas, 16 A.3d 48 (Del. Ch. 2011), the business judgement rule allowed directors to refuse to sell the company, although a sale would have given Airgas' shareholders a profit.
One bright spot for me after the COVID epidemic, was seeing the jobs outnumbering the applicants. Any inconvenience was worth it. Where I had worked we were always reminded that there was a line at the door waiting to take our jobs. (We were non-union). But for many of us, moving to another job meant starting at lower wages and giving up benefits like vacation time that we had worked for years to accrue. There was also the worry of “last hired, first fired”. I jumped for joy when, after COVID, workers refused to apply for jobs where they were essentially abused, underpaid, under appreciated and where benefits were practically nonexistent.
I saw Mickey Mantle play in White Sox Stadium, Comisky Park.
Another reading I would suggest is an article from the Sierra Club's magazine almost 20 years ago. It made a big impression on me when I first read it. https://vault.sierraclub.org/sierra/200509/corporation.asp
OMG!!! The head football coach!!!!
They've never made it to a major Bowl game. They've subscribing to the Benson/Rubin school of thought that says they gotta pay a lot to get the best. Lol
It is certainly is amusing. I haven't really followed the Bears lately, but, from how they were when I was a student at Cal and attended the games with my dorm-mates, I do have some idea what kind of team they were/are. I suppose hope springs eternal in the minds of the University.
Just keep throwing money at it.