Emerging Issues in Management _Mgmt 440__1_ by hcj


									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?
        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
   – 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
        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
  – 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
      • 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
      • 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
      • 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
   – “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
       • 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.
   – Socialism
       • Wanted collective ownership of property in classless society.
       • Many early unions grounded in Socialist doctrine and
        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
      • 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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