Capitalism

“A Disease of the Public Mind”

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That is the title of a book about the first US Civil War that resulted in the assassination of President Lincoln. The soldiers in the South hated those in the North and vice versa. Northern soldiers have since been credited with undeserved virtue while Southern rebels were labeled racist enemies of the state, a moniker that still survives in the present day. But neither side was fighting over the abolition of slavery.

 

Trump’s opponents claim he will re-institute Jim Crow oppression, put black people back in chains, end democracy and put people in Hitler’s concentration camps. The continuous character assassinations, legal persecutions, numerous impeachments, unfounded accusations and insinuation caused what has been called Trump Derangement Syndrome (TDS), a disease of the public mind resulting in a recent assassination attempt.

 

Follow the Money
The Constitution the North and South agreed upon in 1788 enshrined the economic principles of Adam Smith’s Wealth of Nations, fostering equality under the law, individual sovereignty and limited government. Slavery was still too contentious an issue to settle. Starting in the next century the British led a moral crusade to eliminate slavery globally. While politically virtuous, Britain could afford to pay off slave owners and generally didn’t face the the vexing question for US plantation owners of whether freed slaves could support themselves and, if not, whether this would lead to murderous riots as had happened elsewhere. Abolition was a contentious issue everywhere slavery was practiced, typically with long drawn out steps to complete. But the long simmering political dispute that came to a head in 1860 wasn’t about abolition, but money. The federal government relied almost exclusively on tariffs raised in Southern ports – most of which went to northern states – on imports financed with the fruits of slavery, cotton exports.

 

Since the Civil War, limited government has given way to big government. The Democratic Party has created many dependent constituencies whose continued prosperity depends upon continuing Democratic power and largess: the bureaucracy, the government at all levels, teachers, labor leaders, academic educators and administrators, trial lawyers, government contractors, social security recipients and what are still euphemistically called journalists, among many others. The current Civil War is also about money. Trump has been in both political parties, fits in neither. But ”you are fired” represents an existential threat to Party members.

 

For contemporary Democratic politicians, almost all trained as lawyers, money beyond what is available by taxing the rich exists in banks, especially the Federal Reserve Banks, to be distributed according to the spoils system. For Republican politicians (but not RINOs), mostly former businessmen, prosperity comes from productive work and from savings productively invested. For those businesses and workers who are not on the receiving end of the spoils system, whose taxes pay for political largess, limited government is the only solution. There is very little middle ground.

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Another Brand Bites the Dust?

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So Dove, a venerable brand of bar soap (owned by Lever Brothers, AKA Unilever, which has an enormous stable of household brands) looks to have trod heavily on its metaphorical private parts in falling for the supposed magic of an internet celebrity “influencer”, a woman who bears a notable resemblance to the Venus of Willendorf and is a malicious racist besides. I swear, I wonder if someone has spiked the coffee urns or the water coolers at whoever is the most currently popular advertising agency with hallucinogenic compounds, or if the advert creators and the approving corporate C-suite executives have all just drunk too deeply of the magical diversity madness. There is a place for edgy – and it’s not with mainstream commodities with a long history of appealing to a wide segment of consumers. On recent examination, I deduce that they are not teaching this in marketing classes lately.

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Experience Is A Dear School…

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… but fools will learn in no other, as the old saying has it – and ‘dear’ in this sense means ‘expensive’. From all reports concerning the marketing debacle over Bud Light beer, the marketing executive responsible, one Alissa Gordon Heinerscheid is about to learn one of those very dear lessons. When someone sits down to write a history of bad marketing decisions in modern times, this is going to be one of the more spectacular chapters. Amazing that someone so expensively educated in the marketing trade could fall so spectacularly flat-footed. Somewhere back in the mists of time, someone must have imparted the wisdom that alienating the old core market for your product before appealing to the new core market was a bad move. A very bad move.

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“How Twitter Pushed Stakeholders under the (Musk) Bus”

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Here.

Abstract:

This paper provides a case study of the acquisition of Twitter by Elon Musk. Our analysis indicates that when negotiating the sale of their company to Musk, Twitter’s leaders chose to disregard the interests of the company’s stakeholders and to focus exclusively on the interests of shareholders and the corporate leaders themselves. In particular, Twitter’s corporate leaders elected to push under the bus the interests of company employees, as well as the mission statements and core values to which Twitter had pledged allegiance for years.
 
Our analysis supports the view that the stakeholder rhetoric of corporate leaders, including in corporate mission and purpose statements, is mostly for show and is not matched by their actual decisions and conduct (Bebchuk and Tallarita (2020)). Our findings also suggest that corporate leaders selling their company should not be relied upon to safeguard the interests of stakeholders, contrary to the predictions of the implicit promises and team production theories of Coffee (1986), Shleifer-Summers (1988) and Blair-Stout (1999).

There is tension between the interests of owners and those of other “stakeholders”, which is why the interests of non-owner stakeholders require justification as in the linked article. The authors beg the question — they assume stakeholder interests are comparable to owner interests — then find a problem because Musk values his ownership interest in Twitter above the interests of the people he bought out and of the company’s non-owner employees. So what should Musk get in exchange for the $billions he spent? Arguments for more stakeholder rights are arguments for less property rights.

Who Knows?

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So, by a curious coincidence, my address has been tagged by a long-time and established polling organization, to receive increasingly plaintive pleas for any adult in the household to participate in whatever line of questioning on important matters which they have been asked to research. I guess that someone doing basic research has tagged my residence as representative of a demographic, based on value of home, area of address, ethnic background, income, education, profession … or whatever judgment is used to select respondents for national surveys. One of those mailers even included a $5 bill as token of earnest intent. I pocketed the bill – hey, five bucks that I didn’t have before – and threw the rest of it in the recycle bin.
Time was when I would have been Nancy Nice Person and signed on to give my opinion – hey, I signed up to review movies and books, yea these many years ago, mostly for the freebies which that exercise offered, and once again to give judgment on various surveys that my local grocery store chain offers (in hope of scoring one of those drawings for gift cards) but all that is merely a matter of consumer aesthetics and tastes. This polling enterprise is on a whole ‘nother level. It may touch on the political, and that – like the electrified rail in subway routes – is a thing that I will not venture in these present times. Although I post here, on matters social and political, it is not with my given legal name and residential address firmly attached to said opinions and comment.

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