Opinion | American Capitalism Isn’t Working. – by David Leonhardt – The New York Times

“The October 1944 edition of Fortune magazine carried an article by a corporate executive that makes for amazing reading today. It was written by William B. Benton — a co-founder of the Benton & Bowles ad agency — and an editor’s note explained that Benton was speaking not just for himself but on behalf of a major corporate lobbying group. The article then laid out a vision for American prosperity after World War II.

At the time, almost nobody took postwar prosperity for granted. The world had just endured 15 years of depression and war. Many Americans were worried that the end of wartime production, combined with the return of job-seeking soldiers, would plunge the economy into a new slump.

“Today victory is our purpose,” Benton wrote. “Tomorrow our goal will be jobs, peacetime production, high living standards and opportunity.” That goal, he wrote, depended on American businesses accepting “necessary and appropriate government regulation,” as well as labor unions. It depended on companies not earning their profits “at the expense of the welfare of the community.” It depended on rising wages.”

. . . . . .

“Elizabeth Warren, the Massachusetts senator, is now rolling out a platform for her almost-certain presidential campaign, and it includes an answer to this question. It is a fascinating one, because it differs from the usual Democratic agenda of progressive taxes and bigger social programs (which Warren also supports). Her idea is the most intriguing policy idea to come out of the early 2020 campaign.

Warren wants an economy in which companies again invest in their workers and communities. Yet she doesn’t believe it can happen organically, as it did in the 1940s, because financial markets will punish well-meaning executives who stop trying to maximize short-term profits. “They can’t go back,” she told me recently. “You have to do it with a rule.”

She has proposed a bill in the Senate — and Ben Ray Luján, a top House Democrat, will soon offer it there — that would require corporate boards to take into account the interests of customers, employees and communities. To make sure that happens, 40 percent of a company’s board seats would be elected by employees. Germany uses a version of this “shared-governance” model, mostly successfully. Even in today’s hypercompetitive economy, German corporations earn nice profits with a philosophy that looks more like William Benton’s than Gordon Gekko’s.”

David Lindsay:  Yes, and  thank you. Here are the top two comments, that I endorse:

Ed M
Michigan

If I had to choose one word to describe what we’ve lost in our decades-old slide into an Ayn Rand fantasy world, it would be “balance.” It seems as if today’s leaders believe that by rewarding the top with unfathomable riches, the rising tide will lift all boats. Sadly, what we see is an increasing share of the population drowning. The ruling class has unilaterally broken the social contract that served us so well and replaced it with a system where everything is for profit and everything is for sale – people, morality, the environment – everything. Have we no sense of shame left?

Socrates commented 11 hours ago

Socrates
Downtown Verona. NJ

From: REWARDING OR HOARDING ? An Examination of Pay Ratios Revealed by Dodd-Frank…by the staff of Representative Keith Ellison Auto-parts maker Aptiv CEO-worker pay ratio: 2,526 to 1 Temp agency Manpower CEO-worker 2,483 to 1 Amusement Park Six Flags CEO-worker 1,920 to 1 Del Monte Produce CEO-worker 1,465 to 1 Apparel maker VF CEO-worker 1,353 to 1 Marathon Petroleum CEO-worker 935 to 1 The industry with the highest average ratio CEO to worker pay is the consumer discretionary industry with a ratio of 977 to 1 – this category includes companies that sell clothing and food such as McDonalds, Gap, and Kohl’s. The company with the smallest ratio in the database is Warren Buffett’s Berkshire Hathaway, with a ratio of 2:1. The company with the largest ratio is Mattel Toys, with a ratio of 4,987:1 Also, some companies exclude third-party contractors, which suggests that the true level of inequality between CEO pay and median worker pay is even higher. https://ellison.house.gov/sites/ellison.house.gov/files/Rewarding%20Or%20Hoarding%20Full%20Report.pdf In the 1970s, the top 1% of families earned less than 10% of the total national income earned by all workers Today, the top 1% share is greater than 20%. Despite increases in worker productivity over the course of the last four decades, the top 1% have taken whatever they could get away with, which was the destruction of the working class and the middle class. Vulture capitalism is turning America into a feudal society.

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