Transcript Emerging Issues in Management (Mgmt 440)

Emerging Issues in Management
(Mgmt 440)
Critics of Business (Chapter 4)
Professor Charles H. Smith
Summer 2011
Case Study – Mary “Mother” Jones
• Read this case study on pages 80-83 on your
own before class and discuss the following
questions with small groups in class
– What were Mother Jones’ main points?
– Did the fact that Mother Jones was a
woman help or hinder her effectiveness?
Why?
Introduction to and Origins of
Critical Attitudes Toward Business
• Critics of business base their arguments on the
following concepts
– Businesspeople often place profit above
values such as honesty, truth, justice, love,
piety, aesthetics, tranquility, and respect for
nature.
– Economic development puts a strain on
society.
– Student examples of both.
Introduction to and Origins of Critical
Attitudes Toward Business cont.
• Greeks and Romans – both were agrarian societies
– Philosophers reasoned that profit-seeking was an
inferior motive; commerce led to excess,
corruption and misery.
• Plato – insatiable appetites exist in every
person but could be controlled by acquiring
inner values.
• Aristotle – believed in benign form of
acquisition consisting of getting things needed
for subsistence.
• Epictetus and Marcus Aurelius – truly rich
person had inner peace rather than money or
property.
Introduction to and Origins of Critical
Attitudes Toward Business cont.
• Middle Ages – Roman Catholic Church was dominant
– Roman Catholic theology opposed profit-seeking
due to persecution of early Christians by wealthy
Romans.
– St. Augustine – material wealth had fixed supply so,
to become rich, person would sin by accumulation
violating natural equality of creation.
– Love of material things pulled soul away from God
(“no one can serve two masters”).
– St. Thomas Aquinas – influenced by Aristotle
• Just price vs. market price.
• Condemnation of usury.
• Both ideals faded – “commercial activity proved
stronger than fear of prison or hell.”
Introduction to and Origins of Critical
Attitudes Toward Business cont.
• Modern World
– Protestant ethic – work was way to serve God;
earning great wealth through hard work showed
God’s approval; helped remove traditional
religious suspicion of and antagonism toward
material wealth; possible predecessor to
“prosperity” doctrine followed by some Christians
today?
– Capitalism – free market harnessed greed and
protected people from abuses.
– Industrial revolution – rapid changes in societies
due to technological development; faster-paced,
greater emphasis on material things, and abuse
of people and nature.
American View Toward Business
• Colonial Era (pre-Revolution)
– Colonists often portrayed as people seeking
religious or political freedom.
– In reality, colonists were sponsored by investors
seeking valuable commodities such as gold, furs
and timber products.
– As colonists migrated in from coast, farming and
land speculation started.
American View Toward Business cont.
• Young Nation (late 18th Century)
– Farmers and planters dominant since economy
was 90% agricultural.
– Alexander Hamilton – believed industrial growth
would increase national power; sought to promote
manufacturing and finance.
– Thomas Jefferson – unsuccessfully opposed this
trend; felt manufacturing was corrupt and God
had placed “genuine virtue” on farmers.
American View Toward Business cont.
• 19th Century Through the Civil War
– Steady economic growth fueled by improved
transportation systems (turnpikes, canals and
railroads).
– “Utopias” were reaction to increased prominence
of capitalism (e.g., New Harmony) but capitalism
survived and “utopias” did not.
American View Toward Business cont.
• Post-Civil War Era Through the 1920’s
– Populism advocated government ownership of
railroad, telegraph and telephone companies, direct
election of U.S. Senators, and abandonment of the
gold standard; considered to be radical.
– Progressive movement more mainstream; wanted to
cure social ills through government regulation; ended
up achieving some of populist agenda (e.g., passage
of 17th Amendment requiring direct election of U.S.
Senators).
– Socialism wanted collective ownership of property in
classless society; many early unions grounded in
Socialist doctrine and rhetoric.
American View Toward Business cont.
• Great Depression
– “Perpetual prosperity” belief shattered by
economic disaster caused by corporate
negligence and fraud.
– Because of this, securities regulation laws passed
by Congress.
– Populist thought and rhetoric reemerged.
American View Toward Business cont.
• World War II
– Support for business rebounded due to patriotism
since most industries very involved in war effort.
– Negated populist thinking since people were
reluctant to criticize the “arsenal of democracy.”
American View Toward Business cont.
• The 1960’s
– “The Collapse of Confidence” led by four strong social
movements
• Civil rights.
• Consumer rights.
• The environment.
• Anti-Vietnam War.
– These four movements maintained that business
contributed to social ills such as racism, sexism,
consumer fraud, and war profiteering.
– Business started to make a comeback when
President Reagan elected in 1980.
American View Toward Business cont.
• Late 20th Century to the Present
– New Progressives – maintained that business
had too much power and inordinate legal rights,
and was inherently immoral.
– Ralph Nader – “Unsafe at Any Speed” (1965) and
Presidential candidate (2000 and 2004).
– See Figure 4.3 on page 101 for example of how
the New Progressives work.
Case Study – KFC
• Read “A Campaign Against KFC
Corporation” on pages 108-16 on your
own before class and then discuss the
questions on page 116 with small groups
in class.