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LOS ANGELES, CA - OCTOBER 01: Protesters hold signs after a march to Los Angeles City Hall during the "Occupy Los Angeles" demonstration in solidarity with the ongoing "Occupy Wall Street" protest in New York City on October 1, 2011 in Los Angeles, California. The protesters slogan, "We are the 99 percent," calls attention to the fact that marchers are not part of the one percent of Americans who hold a vast portion of the nation's wealth. (Photo by Kevork Djansezian/Getty Images)
I've been meaning to link to this post from a wonky econoblog, The Slack Wire, for a while, but I haven't gotten around to it. Given that I haven't posted about the Occupy Movement for a week or so, it seems like a good time:
The key thing is that at one point, large businesses really were run by people who, while autocratic within the firm and often vicious in defense of their privileges, really did identify with the particular businesses they managed and focused their energy on their survival and growth, and even on the sheer disinterested desire to do their kind of business well. You can find a few businesses that are still run like this -- I've been meaning to write a post on Steve Jobs -- but by far the dominant ethos among managers today is that a business exists only to enrich its shareholders, including, of course, senior managers themselves. Which they have done very successfully....
What's interesting here is that American business culture offers two poles. One is easily represented by Apple, with its visionary leader and commitment to "insanely great" first and, it would seem, shareholder profit second (on the assumption that if you get the company right, the returns will naturally follow). Companies like General Motors and Ford also represent this, but because they're legacy companies with growth rates that, while encouraging, aren't as compelling to investors, they don't get the hype that Apple does.
The other is represented by CNBC and its brand of daily Wall Street inside baseball — the view that a company is wholly summarized by its share price and quarterly earnings. It isn't about being a company. It's about being bought and sold on the markets, and about generating ever-ascending profits for investors.
The Occupy Movement has correctly identified the this extreme as being a worthy target of its rage. They're a little late to the game — the "financialization" of the economy has been ongoing for more than 30 years. But better late than never.
If it's any consolation, a financial firm that looks to have stood for many of things that OWS hates...declared bankruptcy today! MF Global, which was under the command of former Goldman Sachs CEO and former New Jersey governor Jon Corzine, specialized in high-risk financialized operations. It all probably looked good. Until the Eurozone crisis killed it.