How American Corporations Transformed from Producers to Predators

[xchrom]

http://www.alternet.org/story/154745/how_american_corporations_transformed_from_producers_to_predators?akid=8512.277129.423K-x&rd=1&t=2

Corporations are not working for the 99 percent. But this wasn’t always the case. In a special five-part series, William Lazonick, professor at UMass, president of the Academic-Industry Research Network, and a leading expert on the business corporation, along with journalist Ken Jacobson and AlterNet’s Lynn Parramore, will examine the foundations, history and purpose of the corporation to answer this vital question: How can the public take control of the business corporation and make it work for the real economy?

In 2010, the top 500 U.S. corporations – the Fortune 500 – generated $10.7 trillion in sales, reaped a whopping $702 billion in profits, and employed 24.9 million people around the globe. Historically, when these corporations have invested in the productive capabilities of their American employees, we’ve had lots of well-paid and stable jobs.

That was the case a half century ago.

Unfortunately, it’s not the case today. For the past three decades, top executives have been rewarding themselves with mega-million dollar compensation packages while American workers have suffered an unrelenting disappearance of middle-class jobs. Since the 1990s, this hollowing out of the middle-class has even affected people with lots of education and work experience. As the Occupy Wall Street movement has recognized, concentration of income and wealth of the top “1 percent” leaves the rest of us high and dry.

What went wrong? A fundamental transformation in the investment strategies of major U.S. corporations is a big part of the story.

[varelse]

1. K&R

[HughBeaumont]

2. K & R for later sharing.

"Most productive class" my ASS.

[TahitiNut]

3. Corporations have been overrun and taken over by a plague of MBAs ....

... instead of folks who KNOW operations. It's like replacing herding dogs with wolves ... these people not only haven't the slightest comprehension of shopp floor operations, they sneer at the very suggestion. They're about slicing and dicing, outsourcing and selling out. They have a lot in common with car thieves who 'harvest' the cars for parts on the black market ... and NOTHING in common with automotive engineers.

Over 100 years ago, Thorstein Veblen describe the difference between people who go into business because they loved creating the product or service, and those who go into business to make money in any way they can. We have people in public education who cannot teach ... but want the power to fire higher-paid teachers and replace them with low-wage teachers. They know NOTHING about the value of teching skills and EVERYTHING about "cooking the books" to make themselves look 'good.' We have people in government dedicated to destroying the mechanisms of democratic self-governance and obsessed with ridding every agency and department of folks motivated to Public Service. We have people in our religious institutions engaged in whoring and pimping their 'church' to secular and commercial goals while giving free rein to their own perversions, while obsessed with decimating the rank and file and killing off those who serve the poor and 'unwashed.'

General Motors was taken over by the investment-banker-approved butchers back in the days of Roger Smith. Folks with a lifetime of expertise in designing, engineering, and manufacturing automobiles like the 56 Chevy were kicked to the curb. The Flint blue-collar holocaust was well-described by Michael Moore in "Roger and Me."

As long as our kids are seduced by the enormous riches sucked out of the economy by Wall Street and the hedge funds, and sneer at the nerds, geeks, and dweebs in Math, Engineering, and Science while they aspire to luxury boxes at professional sports venues (bread and circuses anyone?), we will continue the long slide into the trash heap of history.

[tk2kewl]

4. K&R

[socialindependocrat]

5. Don't leave any money lying on the table...

This marketing motto is driving us to ruin

We used to make "improved" products that cost less to make.
The consumer could save money.
Now the manufacturer charges the same price as the replaced product and pockets the additional money.

You go to the vet with a petigreed dog you bought for $400
Just to visit the vet it costs $50
Then they tell you the family pet needs an $800 operation
They can do this because they know you love your pet
and if you have kids, it would be traumatic to lose the pet.

Corporations "downsize" and they give the business leaders bonuses for failing to support the company's workforce.
A lot of money goes into corporate bonuses and not back into the company into R&D to expand it's product line.

Responsibility is pushed down to employees with lower pay. Benefits are reduced. After 35 years of doing your part to build the company they say they are not going to give you the retirement benefits they said they would because you never signed a paper holding them to your original agreement (but you had to sign papers for everything that was on value to the company).

We reduce the workday to 8 hours - then someone makes a rule that people who get paid a certain amount are "exempt" for receiving overtime pay. Now they work 12-14 hours a day and weekends, if necessary and don't get paid overtime. We make a law and someone else makes another rule to get around it.

Corporations have channeled money to the upper 1% and the cost of goods has risen 25%-60% so that now we are to the point where the middle and lower classes don't have the discretionary funds to buy the products to support the American businesses.

We need to rebalance salaries, work laws, unions and focus on benefiting all Americans. We need to restore the American dream!

[sinkingfeeling]

6. This is what are 'news' people should be speaking about instead of what Leslie Lohman

is up to. Excellent article. Can't wait for the rest.

[idwiyo]

7. K&R