Anyway, is it possible for a corporation to be honest with its customers and in its reports and accounting an everything and make it in this world?
The way I see it, since companies are playing with their acounting and making themselves look beter (so that their stock doesnt drop, they won’t release that they’re f*cking up, for example), a totally honest company can’t make it because it’d be overwhelmed. I hope this is clear because I’m reading the post back and it’s fuzzy. This is analogous to tampering with DNA to custom-design babies (which we probably shouldn’t discuss in this thread because it’d be way too long). If a few people make their babies super smart and super strong, others will have to do the same or face having “inferior” babies that have lower chances of success in our world.
Actually works the other way around, those companies who are honest and straightforward in all their operations generally do better than those that don’t. People trust them and will be loyal to them.
This argument is used to justify various violations of free market principles all the time, i.e. we government subsidies for product X because we have to compete against foreign companies whose goverments subsidize their product X. Ethically it’s the equivalent of saying that ‘Two wrongs make a right’. Whether or not it is an effective economic strategy I don’t know, but I’d like to believe that if one company is truly better than the other one that it would be able to overcome such tactics.
There are certainly exceptions to the generalized rule that lekatt proposed. I suspect that those exceptions tend to be found in fairly specific types of situations. In the overall, I believe it is true.
One type of situation where honesty seems to get trashed is at the opening wave of new types of technology or product. Microsoft would be one (as would IBM), the original Standard Oil would be another. Interestingly, each of them clearly employed “dirty tricks” in the market place, but I don’t recall any of them being accused of cooking the books in the way that the recent Enron and Worldcom, (also corporations diving into changed markets), had lied in their fiscal reporting. In the long run, companies such as Standard Oil and Microsoft will offend so many people that the government will be brought in to control them.
However, in the cases of most companies, cooking the books can only be a short-term practice. Any extended use of bad accounting will ultimately harm the corporation more than it will help. Similarly, shoddy manufacturing or distribution practices will hurt sales. There is probably some level of incompetence to which many industries have risen or fallen that prevents us from seeing the highest quality in every product. Similarly, internal budget struggles will often manifest themselves as bad accounting as one department or another messes with their books, but in my experience, the most successful companies in established industries have made a sincere (if not always successful) effort to provide quality products and maintain clean books.
However, even though it’s generally in the best interests of a company to be honest, it may not be in the best interests of individual employees in the company. It can be extremely profitable to, say, artificially inflate the value of your company’s stock, then quit and unload all of your shares before people find out that the stock is really about as valuable as the one-ply toilet paper they use in particularly cheap gas station restrooms.
And this is why we need laws against that sort of thing. Relying on the libertarian ideal of everyone being nice and moral because it’s best in the long run for society as a whole just doesn’t work. We need these laws, and they need to be enforced - and a helluva lot better than they’ve been enforced the past couple decades. Fortunately, the current CEO Shame-a-palooza should frighten others from following in the footsteps of Enron, et al, but the phenomenon will be short-lived if people start to think they can get away with it again.
Scylla, is the Tasty Baking Company the company that makes Tasty Cakes, those luscious peanut-butter and chocolate cake treats that I wish I could access in my own state? Oh god, about the only reason I am jealous of people that live in PA…
After you order your food, be sure and head over to the “executive sweet” and read the message to shareholders by Carl Watts (and look at his picture. There’s a man who cares about his Tastycakes)
Oh man, I’m breaking out the credit card!!! I stock up all the time when I travel to/through the PA/NJ area where they distribute most readily. No longer!
…Anyway, for some attempt at content…
I have often wondered that this isn’t a case of selective memory. I mean, the number of companies involved in scandals versus the total number of companies? But you know, as objective as that may be, I’m not sure it really would stand up to a thorough critique. Much of the reasons I have for liking companies comes not from my estimation of this ratio, but my experiences with the companies I worked for (who did not go crazy for cheating, lying, or otherwise attempting to scam people).
It is hard to divorce myself from personal prejudice in favor of corporations on this point. Well, that and I’ve never understood why the charge of inherent dishonesty in business (and, for that matter, politics) without looking at it like a mirror on the soul. Pot, kettle, etc.
On the other hand, the pot’s response was never revealed. My sources indicate the pot replied, “Well, the kettle is black.” Quite.
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