The Washington-based Cato Institute has just published a pamphlet titled "Business and the Fight for a Free Society" that's available from them for the asking. In it Theodore J. Forstmann, founder of Forstmann, Little & Co., investment firm and Ed Crane, founder and president of the Cato Institute write about the statist goals of American businessmen.
Forstmann quotes Thomas Murphy, former GM chairman, "General Motors is not in the business of making cars. General Motors is in the business of making money." In a truly free market, you can't make money without pleasing your fellow man by making high quality products, but Forstmann says businessmen like Murphy circumvent that difficulty by lobbying government for trade sanctions against foreign imports and other restrictions. That way profits can be made without fully satisfying consumers.
Businessmen's statist agenda is also seen in their charitable giving. Most corporate giving goes to organizations that have contempt for liberty and promote government control. Forstmann says, "Corporations gave more than twice the funding to anti-capitalist organizations than they did to groups supportive of the free market." Former Treasury Secretary Dr. William Simon recognizes the destructive folly of giving to enemies of capitalism, saying, "We in the American business community have a right and a responsibility to steer our gifts to institutions committed to maintaining freedom."
Expediency, not principle, guides many businessmen. In 1994, when Republicans won Congress, business PACs that supported the Democrats during the campaign rushed in to pay off the campaign debts of Republican winners, a tactic known as "catching the late train." Those corporate contributors didn't experience an epiphany or conversion; they simply reshuffled their political portfolios. They wanted to continue purchasing government favors. In 1994, there were new sellers.
Ed Crane argues that businessmen should take a principled stand when testifying or lobbying government. They should stop using government to gain a temporary competitive advantage. They should broaden their myopic view of public policy instead of lobbying for changes in this bill, influencing the markup of that bill and asking for government protection and favors. I'd add they should reject nonsense suggestions of government-business partnerships. After all what kind of partnership is it when one partner has the power to take your property, put you in jail, and possibly shoot you if you disobey his edicts?
What's left of our capitalist system has awesome power to do good. Our entrepreneurial capacity is even more impressive when we recognize that government takes 43 percent of everything we produce and throws all sorts of regulatory hurdles in our paths and yet we still out-produce other nations in nearly every endeavor. Imagine what we could do, and the additional riches we'd all have, if there was less government hindrance. Some have estimated that if taxes and regulation had remained at their 1948 levels our GNP would be 50 percent higher. Unfortunately, Americans have bought the statist promises. As Forstmann says, "Statist society promises you happiness in exchange for the better part of your freedom. Civil society merely guarantees your freedom. Happiness is up to you."
Businessmen have been thoroughly cowed by the enemies of liberty. Instead of standing up to them, businessmen have gone the appeasement route. People have risked their lives to be free to choose: where they live, what they read, and with whom they may bargain. The collapse of communism is fundamentally a triumph of freedom over coercion. American businessmen should be on the side of freedom.
Walter E. Williams
January 20, 1997
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