So, therefore, I remark:
The corporate form exists in its current guise to support an ethos. That is the cult of maximisation. I deliberately omit the word profit from that last sentence. What most managers realise is that they have no idea what profit is. And they also realise that they have no idea how to maximise it, even if they really understand profit. That is because those with any insight realise that doing so requires a knowledge of the future with a degree of certainty that is actually beyond us all. So what they instead do is suggest that other, easier to identify (and fulfil) goals be used as proxies for profit maximisation. Almost invariable that proxy is income growth. The maxim is simple. It is ‘if it’s bigger, it’s better’. And so from the false microeconomic idea of profit maximisation was the cult of growth born.
Amazing how little he knows about business really, isn’t it? People are endlessly cutting unprofitable lines of work. Something he complains about a lot actually.
As I tell my students, the whole of political economy is about the influence of power over the allocation of resources in society. The isomorphic model of corporate form is designed to deliver unaccountable power to a few at cost to many. As it has spread the consequences have become more obvious. But so too has the need for the consideration of alternatives, to which far too little attention has been paid. That’s because if the modern cult of microeconomics is good at anything it is good at crushing alternative thought. We’re all paying the price for that.
Guess that’s why everything should be concentrated into an even smaller group of managers, the State?