Business became
very powerful today, even though in the last years it has proved many times
that the power accumulated by only a few companies can have a negative impact
on the economy of the nations and in the same time the social costs that have
to be paid because of the reckless attitude of big financial corporations. The
free market that was described by Adam Smith, where buyers and sellers meet
with each other and possess equal power and information is as romantic and
naïve as it can be in a word dominated by multinational companies that are so
big so powerful and so wealthy that are dominating and ruling the entire
economy (Henderson,
1996, p. 158).
The power that corporations have today is so big that can affect the life of
the social communities in a very dramatic way. Corporations became so much
powerful that they can literally decide to create a new city or to destroy one.
“A corporate decision on the location of a plant may create a new city or
destroy an old one.” (Estes, 1996, p. 179). This power
however should come with a lot of responsibilities and regulation and in the
same time with a lot of studies of the aggregate costs of corporation, studies
that should be made by the Congress, that are actually not intended. Although
the costs of implications of those companies became bigger and bigger once with
the expansion and the evolution, there are not any direct evaluations of the
harm that those business caused to the environment and the people because of
their activities.
If someone would
evaluate correctly the benefits and the negative aspects of corporations would
found out that the society has lost a lot because of the development of their
business. The corporations became in time much more powerful than the small companies
did. The corporations suffered dramatic mutations from their initial purposes
of serving the public interest and
becoming interested only on accumulating financial sources and serving
the private interests of a small amount of powerful companies and their
shareholders: “The history of corporation is the history of a dramatic mutation
of purpose , from serving the broad public interest to serving only the private
interests represented by the bottom line”
(Estes, 1996, p. 192 ). This fundamental change of the companies in the
social structure has determined great loses and great social costs to
stakeholders. Although there is no study about the impact of the implication of
those corporation, there is a estimation that much part of the federal deficit
can be linked to the damage and misbehavior of the corporation that understand
to carry their activity by damaging the environment. Many of those companies
however are deeply implicated in the policy and have access to media and to
influential policymakers (Estes, 1996, p. 192).
It is no wonder that the Congress never had the intention of funding a study of
the aggregate costs of corporations. The corporations benefit a lot from the
numerous protective tariffs, special tax deduction, foreign tax credits,
defense contracts, direct bailouts that not only helped them getting even
richer, but also had a big impact on the world economic environment: “Congress
has never funded a study of the aggregate cost of corporations. The accounting
profession, while it has spent millions of dollars assessing such issues as the
cost of regulation on corporations, has never evaluated the cost of
corporations on society” (Estes, 1996, p. 192).
References:
Estes,
R. W. (1996). Tyranny of the bottom line: why corporations make good people
do bad things. Berrett-Koehler Publishers.
Henderson,
H. (1996). Creating alternative futures: the end of economics. Kumarian
Press.
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