It is September. All across America it is time for football, autumn leaves, ripening apples, and the return of the annual United Way campaign. It’s also time for me to repost my annual diatribe against corporations. I do this not because I think it will change anything, or because I think complaining absolves me of my complicity in enabling their behavior. I do it because I’m in a lousy mood.
Here at 20 Prospect my Dark Corporate Overlords kicked off their annual appeal by feeding us breakfast, then reminding us that families in Minnesota are going hungry during these trying economic times. Working families. They need our support and contributions now more than ever. Subtle. They did have the decency to stop short of asking us to eat all the food on our plates because kids were starving in Africa. Frankly, I was amazed at their restraint.
I know, how can I possible find a reason to complain about charitable giving? I must have no heart. Well, let me clarify things. I believe in community. I do. I also believe that citizens and companies have a moral obligation to be charitable to those in need in their communities. In fact, it’s part of what I consider the definition of a “community” to be. So what’s the problem?
Hypocrisy. Plain and simple. It’s not that I don’t think that there are fine and charitable people in our corporation who participate and lead our annual United Way campaign out of an honest desire to help others. I know these people, and they are sincere. It’s that the whole appeal to “Help make a difference in our Community” is intellectually dishonest. We can make a difference in our community, much larger than just contributing a few dollars from each paycheck to a fine umbrella organization like the United Way. In fact, we are morally obligated to do so as members of our community. But we don’t, and the reasons we don’t are maddening to me at times.
Let me explain. Minnesota is the home of our headquarters, and has been our primary address for almost 100 years. We have grown from a small, family run outfit, into a global corporation with businesses in over 36 countries. We are citizens of Minnesota, as well as each and every one of those 36 countries. But we don’t act like it. We don’t “give back” to the community. We “give back” to shareholders.
I am a shareholder, and an employee. And it has been hard to be either one this past year as we have reduced our workforce by over 20% around the world. We have survived, but we have made some big sacrifices, and 20% of our employee “shareholders” are no longer employees. I am sure more than a few of them are relying on organizations like the United Way to help their families through these tough times. So again, what is my problem?
My problem is this. When we sit down as managers and leaders to build our plan and strategy for the future, no where do we consider “Making a difference in our community” to mean adding jobs, and supporting other local businesses through the work that we do. Instead we focus on the bottom line of profitability, and assume (and I stress assume) that the way to improve profitability is to move more production, engineering, and administrative functions to countries like China and India. Why do we do this? Out of a desire to improve the lives of the Chinese and Indians? No, out of greed. In fact, we do so only because we know that we can pay them less. In fact, we do not grant our new Chinese and Indian employees the same “rights” and benefits that we grant our Minnesota workers. Why? Because the law does not require it, and the market does not demand it. When those two reasons become the pillars of your ethics, you are on shaky ground.
So, from an economic perspective, how can I object? Doesn’t water flow downhill? Shouldn’t businesses always seek the least cost solution to improve efficiency? No, I would argue. What is flawed is the way we define our costs. We do so only by using the most superficial accounting of our finances that is possible under general accounting practices. There is a social cost to moving these jobs, that is only partly illuminated by the “needs” in our community, as expressed in the United Way campaign. These costs are manifest in the decline in wages in Minnesota, in the rising unemployment, in the rising health care costs, and increase in the ranks of the uninsured. It is manifest in the environmental degradation of developing countries, and in the increasing use and price of fossil fuels. These are costs that will not appear on this quarter’s balance sheet, and will not reduce the short term price of a share of our stock. But I believe in my heart that in the long term it will be these costs that destroy our community, and our company.
So my response to our corporate campaigners is that I want to “Live United”, but the company just won’t let me.