I Googled the search term “bad companies.” Other than one result that was for the rock band Bad Company, the leading search results were about companies that according to the various authors are “bad.” The headlines include: The 18 Worst Companies in America, the 20 Worst Companies in the World to Work for, 10 Most Hated Companies in America, and 10 Companies with the Worst Reputations. Not surprisingly the list includes numerous banks, cable providers, and airlines. Curiously enough (or not so curiously enough) Google, Yahoo, Twitter, Facebook, and the mainstream media companies are not on most of the lists. I also Googled “good companies.” There just doesn’t seem to be nearly the number of articles and lists of good companies as there are bad ones.
The point is that is seems popular to bash corporations and I will specifically say American corporations because even though some of these bad companies are multi-national, most are American or at least have a very strong presence in America. I am not sure where this trend started. I notice in movies it is often some “bad corporation” that is engaged in evil doings and tyranny. In the blockbuster Avatar the evil doers are RDA Corporation, some private entity intent on getting rid of the natives on Pandora to exploit the natural resources. One website I found listed hundreds of evil and bad companies from various movies. But if you Google the term “good companies in movies” most of the results are for “good movie production companies” not “good companies in movies.”
The demonization of companies in movies is particularly puzzling when a look at history doesn’t really show that companies have engaged in the sorts of activities that they are portrayed as engaging in, in the movies. Yes, some companies have engaged in unethical and questionable activities, such as exploiting workers and advertising harmful products to children. And the practices by many companies have resulted in disasters such as oil spills and environmental damage.
Yet history is pretty clear. Tyranny, and the types of activities depicted by RDA Corporation in Avatar, have never come from companies. They have always come from government. The Jews were not marched into gas chambers by some company, the Rwandans were not hacked to death by some company, the young men in the trenches of WWI were not ordered there by some company and millions of Chinese under Mao’s Great Leap Forward didn’t die at the hands of some corporation.
To be fair, many movies do feature some branch of a government engaging in evil activities, but it is rarely a “government.” It is usually a rogue individual within a government agency, such as the FBI or the CIA. Once the rogue is brought to justice by the hero of the movie, all is well and good. In movies, the head of the company is usually the prime evil doer, not some rogue individual.
Why is this discussion important? It is important because we live in a country whose unprecedented success has been driven by the activities of businesses in a free market economy. Yet the very system that has provided us prosperity is under attack. College students, politicians and even some economic theorists are suggesting our system doesn’t work and embracing socialism and government control ownership of business enterprises. A few years ago, The Economist published a Special Report on Competition which pretty much concluded that capitalism doesn’t work and needed to be “fixed” through a host of new government programs and interventions.
There are some 7.7 million businesses in the United States (defining a business as having at least one employee – and many more if you include sole proprietorships, freelancers and real estate holding companies). You might be surprised to learn that most of those businesses are not mega-corporations (the ones previously noted as bad corporations). Who are these businesses? They are the people you buy goods and services from every day of the week. I think back over the last seven days (as of the date I am writing this article). I had my car serviced at an independent car repair shop. I stayed at two independently owned motels. I ate at a couple of franchised food restaurants. I bought a new phone charger from an independently owned convenience store. I bought gas from an independently owned gas station. All these businesses are small business owned and operated by people in your community, who may attend your place of worship, who eat and drink at the same places you eat and drink, who may go to your gym or whose children may go to school with your children.
I am even going to give some credit to those big bad companies. Yes, they can be frustrating to deal with. Yes, often their customer service sucks. Yes, they often do things that big companies shouldn’t (But we live in the United States. There are tens of thousands of lawyers whose very livelihood is finding out what those big companies did wrong, and suing them for it, and with great success. Ever have a friend or colleague successful sue the Federal Government?). Despite their flaws those big companies employee a lot of people and provide services that make our lives a whole lot better. How well would you fair without airlines, cell phone companies and automobile manufacturers? I’m not sure any of us are willing to go back to travel by horseback and communicating by telegraph.
Further companies are nothing more than groups of people banding together for a common purpose. And like society in general, some of those people are good and some are bad. Also, like society in general, most people are good (or at least can control their bad side). I think sometimes we fail to give credit to those business owners who really do treat their employees well. Let me give you an example.
I was reviewing the financial results for a client of mine. This business has been around for many years and the owners are financial very well off. I pointed out to the president (a family member) that if they sold or shut down the business and invested the equity they had tied up in working capital, inventory and accounts receivable, they could take that equity and invest it in some passive income activity (like commercial real estate) and earn more than they generate in net income from their business without all of the hassles. He looked at me and said without a moment’s hesitation, “We’re not going to do that. We have about 100 people who rely on us for a paycheck. That means 300 to 400 or so people who depend on this company to live, make their mortgage payments, make their car payments and put food on their tables.”
Now you may be thinking that I happen to have as a client the one generous, charitable, business owner out there. In a world full of devil-run companies, I found the one angel amongst them. That is the furthest thing from the truth. Have ever met a business owner who was a jerk and a nasty person? Of course. And I won’t work for them. But I can assure you they are few and far between. I have worked with close to 200 companies in my career. Most of the owners of those business were wonderful people who cared very much about their employees and did the best they could to treat them well, provide them with decent wages and benefits, and in some cases took extraordinary steps to help employees who were in a jam. I have had clients who bailed employees out of jail, loaned them money when they had financial problems and even kept jobs open while the employee went through lengthy medical treatments or addiction rehabilitation.
Let’s stop bashing companies. Let’s applaud them for providing the jobs they provide and applaud them for providing the goods and services they provide. Let’s also recognize that those movies are wrong. Tyranny does not come from some business enterprise; it always comes from the government. There is a reason that the main-stream media, politicians, and others love to bash companies. The successful business entity flies in the face of those who believe in greater influence and control over economic activity by the government. Finally, let’s spread the word. Let’s make sure that those free- market bashers and business bashers don’t win. We need businesses. It’s part of our system, and pound for pound, it’s still the best system ever devised in the history of mankind.