The interesting thing is article seems more humane and worker-centric than the current philosophy of shareholder supremacy. At least they're giving lip service to improving workers rather than talking about shedding them at the first opportunity.
>...It is hoped that some at least of those who do not sympathize with each of these objects may be led to modify their views; that some employers, whose attitude toward their workmen has been that of trying to get the largest amount of work out of them for the smallest possible wages, may be led to see that a more liberal policy toward their men will pay them better; and that some of those workmen who begrudge a fair and even a large profit to their employers, and who feel that all of the fruits of their labor should belong to them, and that those for whom they work and the capital invested in the business are entitled to little or nothing, may be led to modify these views.
This is ironically coming from the point of view of Scientific Taylorism which many cite as the prime example of vicious selfish pro-executive greed. How strange. Have we taken a step backwards with global supply-chains, corporate citizen-hood, and the ever-increasing "gig-economy" where workers are transient and expendable?
Our center is just way outside and to the right of people's overton windows from 100 years ago with regard to some of those policies.
Not all of them though. They thought tip-only wages, child labor and openly paying different rates based on people's ethnicity were all reasonable practices. Ford would have people inspect his workers home and would dump them if they were being too "foreign", I mean we are talking Lochner era here.
It's a mixed bag. Culture is some amorphous blob, stretching one way and ceding ground the other. You could get a decent paying union job in 1920 without a highschool education but you could be fired for infidelity with your wife, miscegenation, being gay, etc. And just forget about gender equality.
It'd be nice if we could "buffet" practices from the past and skip over the ones we find distasteful.
> Have we taken a step backwards with global supply-chains, corporate citizen-hood, and the ever-increasing "gig-economy" where workers are transient and expendable?
The war described in the article is waged on both sides. The workers themselves are acting as mercenaries - understandable given the conditions. And clearly a business can't extract maximum value from a worker that has absolutely no loyalty.
On a whole though I find the article weak. It's just a hope for an ideal situation with no idea of how to get there. "Can't we all just get along?" - it's clear that no, that state of affairs does not simply spring itself into being.
The article is authored by Frederick Taylor, who had quite a strong sense of what he thought would improve this situation: Scientific Taylorism mixed with higher wages resulting in a shift of worker attitudes.
While today we can debate the growing chasm between worker productivity and wages, it iss important to remember that for over 60 years after this article was written:
- Management practices continued to become more rigorously productivity oriented
- Wages rose in tandem and in proportion to productivity
For all of the faults debated over taylorism and the defects that have developed in our system a century later, on the merits of those points I would say this article has aged well.
I think shareholder supremacy is from Milton Friedman, who promoted the idea of the share price as the important thing to observe, leading to the use and misuse of strategies like stock buybacks:
A framing on this that Friedman made, which many would find more charitable is that executives of a corporation should not be engaged in social policy within a democracy. Corporations are bound by the laws and regulations established by democratically elected bodies, but they are too powerful and prone to capture to allow the c-suite to try to shape society themselves. Individual owners are free to use profits from businesses they have invested in to do whatever they want, because as citizens they are the best unit of participation in democratic society.
That sounds more palatable. But usually in the context of issues like the Bhopal Gas Tragedy, lack of corporate accountability is not an easy thing to digest. Especially these days, if corporations are "people having opinions", as in the Citizens United ruling, why not hold corporations accountable to the same degree as people?
BTW, I don't think Friedman was arguing that corporations should engage in criminal negligence - just that they should not be working explicitly for the good of the society. What was paramount was shareholder value. Probably it is understood that maximizing shareholder value is to be done within legal limits.
Citizens United was explicitly about whether the state could categorize a documentary produced by one company (Citizens United’s Hillary the Movie) as regulated speech, vs documentaries produced by another company (Dog Eat Dog Film’s Fareinheit 911). In both cases there was evidence that the film was produced by a corporation whose shareholders and management explicitly intended to affect an election by engaging in political speech. It was a limit on the state’s capacity to limit one group of people’s speech rights and not another’s.
I agree that maximizing shareholder value is expected to be done within legal limits, but also basic ethical limits. I’m not an expert in Union Carbide’s history, but I was under the impression that the company was hollowed out after selling off assets to pay the Bhopal settlement, and Dow eventually acquired it along with its liabilities for a fraction of what its market cap would have been without the disaster. Criminal negligence can erase a huge amount of shareholder value.
In a different or malfunctioning legal system you could imagine the Indian courts not holding the shareholders responsible for their negligence, the way the US justice department failed to hold the financial industry responsible in 2008 for instance. Smarter people than I have pegged the rise of populist politics in the US as a delayed response to this political and legal failure to wipe out shareholders of corporations that took risks which harmed the economy.
