Corporate Greed – Enough is Enough
There is an unacceptable double standard in our world today. Corporations that cause great harm to people and the environment get a slap on the wrist while the ordinary citizen faces bankruptcy and foreclosure. Banks are too big to fail, but individuals must pay the price for their mistakes. At the same time, a relentless pursuit of profit at all costs leads corporations to outsource services such as custodial and security to avoid paying wages and benefits. If that isn’t enough, other portions of company operations can be moved to India or other countries with low labor costs. Or as in the case of Nabisco, production and investment can be shifted to factories in Mexico leading to layoffs at U.S. locations. Why not move your business to a country with lower labor costs and far fewer laws and regulations regarding the environment, health and safety, and food safety?
The rationale given by companies for outsourcing or off-shoring is that they must do this to keep costs low and remain competitive in the market. They have no choice! Meanwhile, the worker back at the Chicago Nabisco factory has lost his job and can’t even afford a pack of Oreos.
I used to think that eventually the citizens of developing countries would rise up as workers in America and other countries did during the industrial revolution and demand higher wages, benefits, and safe working conditions, but while minimal progress has been made in some countries, the standard of living remains stubbornly low. Foreign corporations continue to exploit the people in these developing countries while increasing CEO pay to obscene levels.
Let’s look at some recent Corporate misdeeds. The great recession of 2008 led to charges against Goldman Sachs and a fine of $5 billion dollars, a minor dent in the annual profits of $30 billion. This company played a role in the huge financial crisis that enveloped our country and led to millions of people losing their jobs and homes. None of the executives were prosecuted. In fact, they even got bonuses totaling $1 million despite receiving $10 billion in tax-payer funded bailout money. Adding insult to injury, in 2011, the company announced that they would be outsourcing 1000 jobs to Singapore and firing 1000 workers in the U.S. and other countries.
How about a more recent example? Employees of Wells Fargo created millions of fraudulent savings and checking accounts and order pre-approved credit cards on behalf of clients without their consent. Approximately 85,000 of the accounts opened incurred fees, totaling $2 million. “Customers’ credit scores were also likely hurt by the fake accounts. The bank was able to prevent customers from pursuing legal action as the opening of an account mandated customers enter into private arbitration with the bank.”(Wikipedia)
If these actions were not bad enough, the company illegally repossessed cars belonging to Service Members and charged 570,000 customers for auto insurance that they did not need!
Other corporate scandals include the Volkswagen emissions cheating, Enron financial scandal, and the Equifax data breach that exposed sensitive information of millions of citizens. Just days before the breach was discovered, Equifax executives sold over $1.8 million worth of shares in the company. It took another 6 weeks for the public to be informed of the breach.
Economist Robert Reich, in his book The Common Good, states the following:
“When the only purpose of business is to make as much money as possible in the shortest time frame, regardless of how it’s done, the common good is easily sacrificed. In pursuit of high profits, whatever it takes, CEOs and the corporations they run have ignored or circumvented the intent of laws to protect workers, communities, the environment, and consumers.” (p. 84)
The corporation and its employees are interdependent. One cannot exist without the other. Unfortunately, corporate loyalty is no longer to the worker, it is to the shareholder. A return to a balanced approach to business that considers the well-being of the workers, their families, and the community is necessary if the common good is to be served. Enough is enough.