Milton Friedman Accused of Making Corporations Greedy
The New York Times brings you news that’s news to you: Before evil libertarian Milton Friedman came along, corporations did nothing but help the people in pursuit of “social responsibility.”
This is the implication of an overkill series of think pieces and a roundtable hooked to Friedman’s essay “The Social Responsibility of Business is to Increase its Profits,” which the Times itself ran in 1970. The newspaper now insists, without rigorous evidence, that this article was “arguably the most consequential economic idea of the latter half of the 20th century.” (It also argues that businesses are now turning against the idea that their only social responsibility is to their shareholders.)
It would require a lot more facts and analysis than the Times chooses to present to prove that corporations decided in the past 50 years to try to make profits their main concern because of a New York Times article by an economist. People starting and running businesses have traditionally done so to make a living and to make the business do well; attributing this to Friedman’s “theories on the primacy of shareholders and the priority of profits” requires more business history and social history than the paper is able to do.
The paper does quote Marc Benioff of Salesforce, angry at Friedman, claiming that in business school in the 1980s Friedman somehow uniquely imbued a generation with the idea that business should be focused on profits. This feels underargued, as does Benioff’s insistence that “obsession with maximizing profits for shareholders has brought us: terrible economic, racial and health inequalities; the catastrophe of climate change.”
In one contribution to the package, Kurt Andersen, the formerly witty editor of Spy magazine, darkly warns that libertarians like Friedman bamboozled liberals by playing on their affection for the idea of freedom. He widens his attack beyond the specifics of the “corporate social responsibility” anniversary news hook to angrily presume that somehow government is doing a lot less to manage American wealth and choices than it was 50 years ago and that Aquarian Age dumbos hypnotized by the belief that people should be free to be you and me, man, allowed this to happen by elevating Friedman and his libertarian hordes to control of the world.
Andersen also thinks that “Theory of the Firm,” a much-cited 1976 journal article by Michael C
Article from Latest – Reason.com