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Emerging Issues in Management (Mgmt 440) Critics of Business (Chapter 4) Professor Charles H. Smith Summer 2012 Case Study – Mary “Mother” Jones • Read this case study on pages 83-86 on your own before class and discuss the following questions with small groups in class – What were Mother Jones’ main points? – Did the fact that Mother Jones was a woman help or hinder her effectiveness? Why? Introduction to and Origins of Critical Attitudes Toward Business • Critics of business base their arguments on the following concepts – Businesspeople often place profit above “good” values such as honesty, truth, justice, love, piety, aesthetics, tranquility, and respect for nature. – Economic development puts a strain on society. – More examples of both. Introduction to and Origins of Critical Attitudes Toward Business cont. • Greeks and Romans – both were agrarian societies – Philosophers reasoned that profit-seeking was an inferior motive; commerce led to excess, corruption and misery. • Plato – insatiable appetites exist in every person but could be controlled by acquiring inner values. • Aristotle – believed in benign form of acquisition consisting of getting things needed for subsistence. • Epictetus and Marcus Aurelius – truly rich person had inner peace rather than money or property. Introduction to and Origins of Critical Attitudes Toward Business cont. • Middle Ages – Roman Catholic Church was dominant – Roman Catholic theology opposed profit-seeking due to persecution of early Christians by wealthy Romans. – St. Augustine – material wealth had fixed supply so, to become rich, person would sin by accumulation violating natural equality of creation. – Love of material things pulled soul away from God (“no one can serve two masters”). – St. Thomas Aquinas – influenced by Aristotle • Just price vs. market price. • Condemnation of usury. • Both ideals faded – “commercial activity proved stronger than fear of prison or hell” (page 88). Introduction to and Origins of Critical Attitudes Toward Business cont. • Modern World – Protestant ethic • Work was way to serve God. • Earning great wealth through hard work showed God’s approval. • Helped remove traditional religious suspicion of and antagonism toward material wealth. • Possible predecessor to “prosperity” doctrine followed by some Christians today? – Capitalism • Free market harnessed greed and protected people from abuses. – Industrial revolution • Rapid changes in societies due to technological development. • Faster-paced, greater emphasis on material things, and abuse of people and nature. American View Toward Business • Colonial Era (pre-Revolution) – Colonists often portrayed as people seeking religious or political freedom. – In reality, colonists were sponsored by investors seeking valuable commodities such as gold, furs and timber products. – As colonists migrated in from coast, farming and land speculation started. American View Toward Business cont. • Young Nation (late 18th Century) – Farmers and planters dominant since economy was 90% agricultural. – Alexander Hamilton • Believed industrial growth would increase national power. • Sought to promote manufacturing and finance. – Thomas Jefferson • Unsuccessfully opposed industrial growth trend. • Felt manufacturing was corrupt and God had placed “genuine virtue” on farmers. American View Toward Business cont. • 19th Century Through the Civil War – Steady economic growth fueled by improved transportation systems (turnpikes, canals and railroads). – “Utopias” were reaction to increased prominence of capitalism (e.g., New Harmony) but capitalism survived and “utopias” did not. American View Toward Business cont. • Post-Civil War Era Through the 1920’s – Populism – radical advocacy • Government ownership of railroad, telegraph and telephone companies. • Direct election of U.S. Senators. • Abandonment of the gold standard; considered to be radical. – Progressive movement – more mainstream • Wanted to cure social ills through government regulation. • Ended up achieving some of populist agenda (e.g., passage of 17th Amendment requiring direct election of U.S. Senators). – Socialism • Wanted collective ownership of property in classless society. • Many early unions grounded in Socialist doctrine and rhetoric. American View Toward Business cont. • Great Depression – “Perpetual prosperity” belief shattered by economic disaster caused by corporate negligence and fraud. – Because of this, securities regulation laws passed by Congress. – Populist thought and rhetoric reemerged. American View Toward Business cont. • World War II – Support for business rebounded due to patriotism since most industries very involved in war effort. – Negated populist thinking since people were reluctant to criticize the “arsenal of democracy.” American View Toward Business cont. • The 1960’s – “The Collapse of Confidence” led by four strong social movements • Civil rights. • Consumer rights. • The environment. • Anti-Vietnam War. – These four movements maintained that business contributed to social ills such as racism, sexism, consumer fraud, and war profiteering. – Business started to make a comeback when President Reagan elected in 1980. American View Toward Business cont. • Late 20th Century to the Present – New Progressives – maintained that business had too much power and inordinate legal rights, and was inherently immoral. – Ralph Nader – “Unsafe at Any Speed” (1965) and Presidential candidate (2000 and 2004). Case Study – KFC • Read “A Campaign Against KFC Corporation” on pages 112-20 on your own before class and then discuss the questions on page 120 with small groups in class.
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