I was surprised to find out about the existence of Triple Bottom Line Companies, in other words, companies whose goals are not only profit, but social good, environmental good, and profit. An example is King Arthur Flour in Vermont:
In certain states, companies that want to brandish their new-economy values can now also register as B Corporations. B Corp registration (the “B” stands for “benefit”) allows a company to subordinate profits to social and environmental goals. Without this legal authorization, a CEO could in theory be sued by stockholders if profit-making is not his sole objective. Such status ensures that specific goals are met by different companies (manufacturers have different requirements from retail stores). It also helps with social marketing and branding. Thus, King Arthur Flour, a highly successful Vermont-based, 100 percent employee-owned ESOP, can be explicit, stating that “making money in itself is not our highest priority.
I remember reading about Al Dunlap, who was hired at several large corporations to downsize. These corporations were “single bottom line,” or “profit only,” so they were vulnerable to being ruthlessly pared down in order to make themselves more attractive to stock speculators (raise their stock price temporarily so execs can take quick and massive profits). Triple Bottom Line companies, so long as they didn’t go bankrupt, would be less vulnerable to the Dunlaps of the world:
For-profits have developed alternatives as well. There are, for example, more than 11,000 companies owned entirely or in significant part by some 13.6 million employees. Most have adopted Employee Stock Ownership Plans; these so-called ESOPs democratize ownership, though only some of them involve participatory management. W.L. Gore, maker of Gore-Tex and many other products, is a leading example: the company has some 9,000 employee-owners at forty-five locations worldwide and generates annual sales of $2.5 billion. Litecontrol, which manufactures high-efficiency, high-performance architectural lighting fixtures, operates as a less typical ESOP; the Massachusetts-based company is entirely owned by roughly 200 employees and fully unionized with the International Brotherhood of Electrical Workers.
A different large-scale corporation, Seventh Generation—the nation’s leader in “green” detergents, dishwashing soap, baby wipes, tissues, paper towels and other household products—has internal policies requiring that no one be paid more than fourteen times the lowest base pay or five times higher than the average employee.
We do need an alternative to the idea that there are other no ideals besides sucking money out of the world. The Market is not efficient
When I use the term “market system,” it is not just the price mechanism but the entire system of regulation, qualification, credentials, reputations and clearing that surrounds that mechanism and makes it operate in a social context.
When economists assume the market is “efficient,” they actually mean “the efficient distribution of benefits” — NOT “the efficient use of materials”:
“The sole moral judgment an economist is supposed to be able to make is a wholly uncontroversial one: if every person is made better off by some change, the change (which is then called ‘Pareto optimal’) should take place. Even philosophers like John Rawls have adopted the notion of Pareto optimality… ” — Donald N. McCloskey
“Economic efficiency” is an assumption that lies at the center of economic politics and is completely different than “materials efficiency”:
“The potential Pareto improvement criterion and other measures of economic efficiency do not pass the test of consistency and coherence within economic theory, nor do such measures accord with what public decision makers seek in policy advice from economists. Such efficiency measures are, nonetheless, durable components of the ideology of economics.” — Daniel W. Bromley
All economic models assume that human brains contain an unspecified and undiscovered mathematical device which maximizes utility (i.e., solve Bayes’ equations):
“Those who believe society can best be understood as a series of markets begin by positing a rational, calculating individual whose goal is to maximize ‘utility.’ This premise says everything and nothing, since it is true by definition in all cases. But it is a key aspect of the market model, since it is the behavioral part of the logical argument that whatever the market decides must be optimal.” — Robert Kuttner, EVERYTHING FOR SALE
This assumption of innate maximizing ability provides the only moral argument (Pareto optimum, Nash equilibrium) that supports the “market system.” However, biologists tell us that people are not utility maximizers!
“[Social science] approaches assume that unbounded rationality is possible and that the mind is a general-purpose computer that can figure out, in any situation, what will maximize a given quantity over the long term (whether utility or children). Indeed, the concept of ‘learning’ within the Standard Social Science Model itself tacitly invokes unbounded rationality, in that learning is the tendency of the general-purpose, equipotential mind to grow — by an unspecified and undiscovered computational means — whatever functional information-processing abilities it needs to serve its purposes, given time and experience in the task environment. [However,] neither human engineers nor evolution can build a computational device that exhibits these forms of unbounded rationality, because such architectures are impossible, even in principle. Although organisms sometimes appear to be pursuing fitness on behalf of their genes, in reality they are executing the evolved circuit logic built into their neural programs, whether this corresponds to current fitness maximization or not. Organisms are adaptation executers, not fitness pursuers. Mapping the computational architecture of the mechanisms will give a precise theory of behavior, while relying on predictions derived from fitness maximization will give a very impoverished and unreliable set of predictions about behavioral dynamics.” — John Toby and Leda Cosmides
Even economists tell us that people are not utility maximizers!
“Subjective expected utility (SEU) theory lies at the foundation of most contemporary economics. In the probabilistic version of SEU theory, Bayes’s rule prescribes how people should take account of new information and how they should respond to incomplete information. But empirical studies find that decision makers often overreact to new information, in violation of Bayes’s rule.” — DECISION MAKING AND PROBLEM SOLVING, Nobel winner Herbert A. Simon
It is axiomatic that if humans cannot maximize, then the market system is not inherently better than any other system of resource distribution and therefore, must be judged by some other metric.
So while banksters are running the world economy into the ground, crunchy granola SWPLs are inventing the next economic model. This is going to be at least as big and as world-changing as the Information Technology Revolution. The time to get in on the ground floor is now — not to become a millionaire, but to participate in social progress.
Our current economic model is MASSIVELY WASTEFUL. It is NOT EFFICIENT. as explained above by the great Jay Hanson.
Hanson’s basic idea is that we’ll either change our economic model to maximize resource efficiency, or we’ll experience doom soon. We actually still have PLENTY of resources, except that the current “market system” uses these resources wastefully and thus dooms itself and us.
It would be possible, with what we have, to sustain ourselves easily, aside from the glaring fact that our economic system is insanely wasteful. And the wastefulness comes from misrule by people who create no value, but pay themselves exorbitant amounts of value created by others (banksters). It’s not just about redistributing the billionaire bucks to ourselves, but dethroning the banksters from the rule over the planet.
And it’s not because I “envy the rich.” It’s because they suck at managing the planet. Hey rich fuckers, billionaire banksters! in the immortal words of Trump, we the mismanaged want to roar
“You’re f’in FIRED!