The Ideal Corporation
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As a means of organizing people to carry out mass production of goods and services, the corporation as a cooperative effort is, in principle, sound. But as an inherently amoral entity, the corporation is in practice a promoter of sin and a source of great evil.
A corporation comes into existence when a large number of people put up money to establish a business and get it going. Each of the funders gets a share of the ownership of the corporation in proportion to the amount of money they put up and when the business becomes profitable they get a dividend of the profit in that same proportion. To manage the corporation, to ensure that the business achieves its goals, the shareholders elect a board of directors.
Thus, a company that could not otherwise have gotten started comes into being. The directors hire executives who, in turn, hire workers, accountants, lawyers, salespeople, and other necessary personnel and also acquire building space and equipment to enable those people to do the jobs they were hired to do. Production begins and the goods or services that the company produces are sold. Money comes into the company, enabling it to pay its obligations and distribute the leftover as profit.
By law, as well as by custom, the directors must make all of their decisions in a way that maximizes profit. Thatís where the corporation becomes a source of evil. For the corporation, to misquote Vince Lombardi, profit isnít everything; itís the only thing that counts. That doctrine is the source of all corporate abuses of workers, suppliers, and customers. It promotes the Deadly Sin of Avarice.
Legal fiction makes the corporation a person, but itís not a person that you would ever want to meet. Simon Baron-Cohen, a professor of psychology and psychiatry at Cambridge University, has determined that the kind of person that the typical corporation most closely resembles is the psychopath, a person completely devoid of empathy for others (see Appendix). For almost two centuries in this country corporations, ravenously greedy for profit, have treated their workers worse than slaves and have callously abused their customers with shoddy products. And the abuse continues.
So how can we re-engineer the corporation in a way that will end the abuse and yet retain the benefit of the corporate way of doing business? How can we end corporate psychopathy?
Ending a corporationís disdain for its workers is straightforward - make all of the employees the companyís shareholders. Giving the employees the power to hire and fire top executives will apply a powerful brake on greed. It would oblige the directors to make decisions actually favoring the company: no longer would the best interests of the shareholders and of the company diverge. The doctrine of shareholder hegemony, used to excuse abuses of the employees, becomes a driving force keeping the company focused on its original goal - providing a good money-making opportunity for all who participate in it.
Of course the original shareholders must make a good profit from their investment if the business survives and thrives. For a number of years they will receive dividends as the business grows and gains strength. Then the corporation will buy back the stock for more than the investors paid originally. In this way we would treat the stock more like bonds.
As the corporation draws in its stock, it will redistribute the shares to its employees based on their length of service and relative value to the company. Machinists and accountants would get more than janitors and stock clerks, for example. The employees will then get the dividends and the voting rights that come with ownership of the shares: the employees will become the owners of the company.
Eliminating the abuse of customers and suppliers gives us a harder problem. Positions of authority attract psychopathic personalities. People who measure themselves by what the get instead of by what they give will lie, cheat, and intimidate their way into those positions in order to assert dominance over others as a means of covering up their deeply rooted feelings of inferiority, uselessness, and worthlessness. Institutions that promote psychopathy do not well serve their societies. If nobody can reform those institutions, then someone needs to replace them.
The old taunt "You can be replaced by a machine" doesnít actually work for the people who actually produce the goods and services, except in some small areas of application. But it would work well for management. Consider the fact that computer programs called neural nets have been trained to process loan applications and have actually performed better than most human loan processors. The managers of a corporation make decisions not grossly dissimilar to processing loan applications, so it should be possible to train a neural net to carry out the work of any manager.
In the middle of February 2011 IBM pitted its machine, Watson, against two of the top players in a game of Jeopardy and it won. Using machine learning, using neural nets, it acquired sufficient command of the English language to solve puzzles involving puns and other wordplay that defies logical analysis.
Of course, we canít expect top management of any corporation to put themselves out of their jobs: their salaries and bonuses offer too much incentive to stay. But the people with the real power to control the corporation, its owners, the stockholders, have an equally strong incentive to eliminate all management positions and associated support staff Ė profit.
The computer can be programmed with a relatively simple ethics module, by which the computer will judge every decision that it makes. All the computer needs is Asimovís three laws of robotics. The first Asimovian law states that a robot will not harm a human or, through inaction, allow a human to be harmed. That law allows no exceptions. The second law states that a robot will obey all orders that humans give it, except those that would lead to a violation of the first law. And the third law tells a robot to preserve its own existence, except when doing so would violate the first and second laws. With those laws in place, the management computers of the corporation will still seek to maximize profit, but they will be constrained in that effort by the requirement that the corporation do nothing that harms the corporationís customers or suppliers.
That proposal raises a small question that we can examine through an example. When their management is taken over by the computers, will the tobacco companies shut themselves down? After all, we know that tobacco use is a risk factor for an impressive number of hideous and nasty diseases. Wouldnít the first law prevent a robot (the corporation) from providing this insidious poison to anyone? The phrase "through inaction, allow a human to be harmed" would appear to be operative here. It obliges us to ask whether we want robots to decide whatís best for us.
You certainly donít want a robot standing idly by while someone harms you. The first law ensures that wonít happen. But would you want a robot to prevent you from taking a risk that you will harm yourself? We regard taking risks as part of being human and, indeed, if the original investors had not taken risks with their wealth, there would not be a corporation. So the first law will have to be so modified that computers and robots will allow people to harm themselves and only prevent others from harming them. It will thus remain the proper duty of culture to shape how people treat themselves.
The first step, the buyback and redistribution of the stock, will likely have to be forced through government action. Current shareholders would be reluctant to sell their stock, even at a profit. Making the proceeds from the sale of stock to its corporation tax free will help to ease the pain, but the transition wonít be entirely pleasant. It will be up to the electorate to put into public office the people who will do this.
The second step, replacing all of the managers with computers, will be easier. Once the employees gain controlling share of the corporation, they can vote to dismiss the directors and managers and replace them with computers and the staff necessary to run them. One obvious incentive to do that lies in the fact that the computer doesnít demand a multi-million dollar salary plus bonuses. Once the master computer is established, replacing the board of directors, it can begin the process of dismissing executives and managers and replacing them with other computers in a network or with upgrades to itself.
Thus an ideal corporation will be born. It will produce goods and services in the quantities and with the efficiencies that come from a large organization. It will enrich its employees in accordance with their efforts, as it should. It will act to ensure its own profitability, but not at the expense of abusing its suppliers, its employees, or its customers. As, in essence, a robot, it will still be completely heartless, but it will nonetheless act out basic human morality, doing so by calculation rather than through empathy. And that will be good enough.
There are twenty traits that psychologists list as being characteristic of psychopaths. Because psychopaths exist on a scale, any given psychopath wonít display all of the traits nor display any given trait to the same extent that other psychopaths do. Here, then, are the psychopathic traits most relevant to a corporation conceived as a person:
1. Lack of empathy. Psychologists consider this to be the defining trait of psychopathy and it indicates a form of brain damage. A psychopath does not react emotionally to occurrences that evoke an emotional response in normal people. He doesnít feel with other people as normal people do. He displays a cold-heartedness that we see clearly in the corporation.
2. Grandiose sense of self-worth. The psychopath professes a belief that he is the only person in the world who counts for anything and that other people exist for the sole purpose of gratifying his desires. This is the means by which the psychopath covers up his subconscious sense of inferiority. He is inadequate to do anything that actually benefits people, so he feels useless and worthless. Instead of working to overcome the deficiency, the psychopath aggrandizes himself, judging himself by what he gets from people (regardless of the means, fair or foul) instead of judging himself by what he gives of himself. A corporation that does not produce goods and services essential to the survival of its society will hype itself in the same way. We see this fact reflected most clearly in the phenomenon of high-fashion makers, who charge exorbitant amounts of money for their products because they have a name on them. In 2016 the fashion house of Armani was ridiculed for charging $12,000 for a jacket that some people described as a potato sack with sleeves.
3. Glibness and superficial charm. The psychopath develops the ability to create the illusion that he cares about people and takes their interests to heart, though in actuality he is trying to learn about people and get them to trust him so that he can take advantage of them. This is the job of the corporationís public relations department, the realm of mealy-mouthed swindlers who speak a hideously sterile form of English.
4. Lack of remorse or sense of guilt. Having convinced himself that other people exist for the sole purpose of gratifying his desires and being incapable of developing an emotional bond with another person, the psychopath has no reaction when people are harmed by his actions. He has no sense that heís done wrong: in his mind heís never wrong. We see this attitude exemplified in corporations that manufacture and sell guns and ammunition. A high murder rate benefits them as more people buy guns and ammunition for self-protection, so they favor the promiscuous sale of guns that gives criminals and lunatics easy access to the weapons. Even the wanton slaughter of a class of first-graders caused no feelings of shame. Indeed, gun sellers gloat when a well-publicized mass shooting leads to an increase in gun sales.
5. Conning and manipulation. Using a combination of deceit and intimidation, the psychopath pushes people into giving him what he wants, even if the result harms the victims. There is no quid pro quo with a psychopath; indeed, the very suggestion that he treat people as he wants them to treat him offends him deeply (because it threatens to expose his inferiority). In a corporation this brings us to the advertising department. Misrepresentation and false promises are their stock in trade, certainly. The intimidation comes through the exploitation of cultural norms. If you donít get all excited over the sexy woman pimping the product, well, you canít be much of a man, so you had better buy our product and be seen using it.
6. Refusal to accept responsibility. In his own mind the psychopath is never wrong about anything; therefore, he is never at fault when something bad happens. This is one of the means that he uses to retard his mental growth. In a corporation thatís the task of the legal department. Under no circumstances, according to the lawyers, is the company to be allowed to accept any responsibility for any damage it does to suppliers, employees, customers, or innocent bystanders. The classic example comes from the companies that produce and sell tobacco products.
Toward the middle of the Twentieth Century doctors became increasingly aware of the hideous diseases that could come from tobacco use. Medical research confirmed the suspicions and showed that tobacco use is a powerful risk factor in the development of those diseases. The tobacco companies responded by funding corrupted research intended solely to cast doubt upon the medical results and then they lied about it. Like the psychopath, they wanted the world to conceive them as angels of perfection, devoid of all fault, and therefore not in the least bit responsible for the damage that the use of their products produced in people.
7. Pathological lying. The psychopath needs to control people and their thinking about him, so he needs to control their conception of reality, especially the reality surrounding him; thus, he lies constantly. He must do this in order to prevent people from discovering just how worthless and despicable he really is. Corporations have the same need and that brings us back to the public relations department. One company, noted for its abuse of its employees, shows all of its new hires a video in which some workers (or actors portraying workers) tell them that they donít need a union because they are now part of a big, happy family. Itís a big lie and itís corporate behavior at its most typical.
Other psychopathic traits, such as proneness to boredom, promiscuous sexual behavior, and impulsivity, donít apply to corporations, though they may apply to at least some of the corporationís top executives. Nonetheless, we can see clearly that, if a corporation is a person, it is a mentally defective one.
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