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I'm taking an elective course this semester called Business Ethics. In this class, we've covered a much broader range of topics than what I was expecting. We've already discussed the scourge of globalization and vilified a large number of well-known companies. What baffles me the most about this course isn't the professor's overt anti-business/anti-capitalism leanings; it's the attitudes of a majority of my fellow students.

I'm not sure why so many business students appear to have such apathy toward the basics of capitalism. I mostly hang out with my finance student friends, so this is a new experience.

Today we had an exam. This was very easy, once I accepted that the professor thinks a "certain way" and expects the highly subjective questions to be answered from that perspective.

This one caught my eye:

True or False: Business leaders have an obligation to see that everyone, particularly those in need, benefit from their firms' actions.

The answer, in the real world, is so obviously False that it hardly bears discussion. However, within the class, the answer is so obviously True that one scarcely has to stop to consider it.

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Unfortunately, just as memes

Unfortunately, just as memes erode with transmission, and "this, too, shall pass away," the core business ethic tends to erode with success -- a case of diminishing marginal utility at work in a most unexpected place.

See also this.

I'm a b-school survivor

I'm a b-school survivor myself, and threw an absolute fit over the non-sense being circulated as moral dialogue in business ethics courses.

Even if you don't buy into libertarianism at all, the ethical claims of the doctrine of the "social responsibility of business" are completely indefensible. I came to class every day and challenged the instructor, passing out copies of things like this

http://www.colorado.edu/studentgroups/libertarians/issues/friedman-soc-resp-business.html

and eventually won converts.

I think the most powerful argument against "business social responsibility" is a knowledge one. Even if Exxon Mobile *wants* to "solve poverty" or "reduce inequality", how do they know *how* to do that, given the broad disagreement between social scientists on these issues?

Companies are good business, not social engineering. If there's any company powerful enough that we have beg it to benevolently solve social problems, well, I think we should be talking about that power, rather than how to dispose of it according to a controdictory and empirically false ethical doctrine like "business social responsibility."

from the sound of that

from the sound of that question, your professor is just a mild liberal, albiet an idealistic one. That actually sounds like a very pro-business/pro-capitalist attitude if you think about. Supposing that a businessman under capitalism actually has such moral responsibilities is silly, but it's actually very kind to capitalism; sidestepping a critique.

True or False: Business

True or False: Business leaders have an obligation to see that everyone, particularly those in need, benefit from their firms' actions.

What on earth does this mean? An obligation? Everyone? Need? Benefits?

No-one on earth has to shoulder such a burden; even governments are not obliged to see to it that everyone benefits from a policy. This requires omniscience, surely?

Should Edison have withheld his inventions because some would be electrocuted? Should Norman Borlaug have abandoned the Green Revolution because famine-relief organizations would be forced to lay off workers?

The implication of reversing the question seems to be that "business leaders" should be held responsible if people do not benefit by their actions. After all, if they are obliged to ensure that everyone benefits, surely they are to blame if some do not.

So I guess I'd say ... False.

maybe the attitudes of a

maybe the attitudes of a majority of your fellow students is really hidden and they act a certain way to make the grade?

Remember that large

Remember that large corporate business is intertwined with the state. These firms are widely considered "public institutions". The training in these schools is designed to prepare future managers of these institutions. I think if you polled most executives across the US you might be surprised at how socialist their belief systems are. Hardcore individualists would, I think, tend to drift toward currency or commodity markets, or start their own firms.

That actually sounds like a

That actually sounds like a very pro-business/pro-capitalist attitude if you think about.

Not at all - it is entirely anti-capitalism, and seeks to subvert the essence of capitalism and replace it with socialism without appearing as such. Better to at least be honest and make your motives clear rather than hiding behind the veil of "social responsibility."

Andrew Chamberlain linked to a piece by Milton Friedman earlier in this thread. An excerpt:

    But the doctrine of "social responsibility" taken seriously would extend the scope of the political mechanism to every human activity. It does not differ in philosophy from the most explicitly collectivist doctrine. It differs only by professing to believe that collectivist ends can be attained without collectivist means. That is why, in my book Capitalism and Freedom, I have called it a "fundamentally subversive doctrine" in a free society, and have said that in such a society, "there is one and only one social responsibility of business?to use it resources and engage in activities designed to increase its profits so long as it stays within the rules of the game, which is to say, engages in open and free competition without deception or fraud."

One of the major contributions of economics is the ability to ignore (for the most part) the wisdom of the objectives we wish to achieve, and simply focus on the most efficient means of reaching those objectives. As Friedman argues, systems work efficiently when we don't fall victim to conceptual muddles; that is, when we define the proper role for each part in that system and make this determination based on concepts like division of labor and comparative advantage.