Many things affect our quality of life for better or worse. What about the complicated effects of corporate actions? There is no doubt that corporations have altered our society immensely. However, the benefit or harm done to us is not that obvious. As far as our quality of life is concerned, I think the results are mixed at best. Let me spotlight some complex issues involving corporate actions.
We must examine four important features when we talk about corporations. They are: motive, size, concentration, and standardization. The first one is simple. Every corporation is geared to profit maximization and boosting their stock price, although it may involve in charity acts.
Despite their number and size, big corporations in the US account for only one-quarter of total employment (as shown in my essay entitled, Corporations and Employment). This casts doubts on the popular idea that lowering corporate taxes helps reduce US unemployment. In fact, during the recent deep recession, US corporations shed plenty of jobs while sitting on huge profits. Even during good times, corporations cut employment as a result of merger, acquisition, reorganization, and most notably, outsourcing. Therefore, it remains a myth that US corporations are a steady major employer in the domestic economy.
Does size make a big difference in business? Absolutely! Size means clout, resources, influence, and power. These can bring enormous benefit and harm depending on how they are being used. Based on their selfish business motives, we cannot assume that corporations will always do things for the public good. Why should they? We can only hope that the consequences of their actions will benefit society as a whole.
Size enables a corporation to do the things that a small company can only dream about. The following is a list of common corporate practices:
*Bribe politicians to make laws and regulations easier for them.
*Predatory practices to squeeze and destroy competitors.
*False advertising to misinform or deceive consumers.
*Consolidate the biggest market share so as to manipulate prices.
*Pollute the environment and avoid paying for the cost of remedy.
*Exploit cheap labor around the world by outsourcing.
The only thing we hope for is that given all the above dubious practices, corporations are creating more jobs for us. Are they really? Even if it is true, is the cost to our quality of life worth the benefit?
Let’s now examine the concentration feature that characterizes corporate production. Profit maximization dictates lowest unit cost, which in turn requires production on a large scale concentrated on a factory site. This model, based on size and concentration, exerts heavy pressure on the environment, such as polluting the air, river, or the surrounding that will take a long time to rectify.
Inside the factory, work is split up so that each group of workers performs one small task quickly and repeatedly. The unfinished product is then passed on to the next group of workers to perform another task of similar nature. This assembly line structure requiring repetitive work everyday exerts a heavy toll on the human spirit that only time will show the real damage. One dramatic effect is a wave of worker suicides at the Foxconn factory in southern China during May of 2010.
Finally, standardization is another feature dictated by corporate production. Standardization enables easier and simpler management of production to deliver lowest cost. The consequence is that it reduces product diversity and makes life boring. One glaring example is fast food. People are attracted to McDonalds because of the low price or a kid’s desire, never mind about the monotony of the food. Going to a fast food restaurant is equivalent to filling up your stomach, not a gastric enjoyment or experience.
Standardization does the most harm in food production because it dictates a monoculture practice. Monoculture greatly reduces the genetic variation of crops provided by nature. Each genetic variation carries a special resistance to drought or plant disease, thus increasing the chances for survival of a given crop. In modern agribusiness, corporations produce only one strain of crop over a very large area. This overemphasis on one strain exposes the crop to the danger of bad weather and plant disease that can easily wipe out the entire harvest. History has shown the calamity of the monoculture mistake, exemplified by the Irish potato famine around 1845.
In conclusion, we have to appreciate the relationship between bigness and quality. Does bigger mean better quality? What do we really want out of life? You have to make this personal decision yourself.