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Who Will Lead the War on Altruism?
[January 29, 2004]

By S. M. Oliva

Ayn Rand once called big business “America’s persecuted minority.” That was 40 years ago. Nothing has changed, however, in the intervening decades. Every single Democratic candidate for president treats America’s producers as the enemies of “working families,” whatever that means. Even the Republican president, George W. Bush, treats business primarily as a source of revenue for charitable projects.

This past week business and political leaders assembled at the annual World Economic Forum in Davos, Switzerland. In recent years Davos has been a source of anti-capitalist rhetoric, particularly anti-American capitalism. This year two prominent American executives—Microsoft chairman Bill Gates and Hewlett Packard CEO Carly Fiorina—made their case at Davos in defense of their businesses.

Their rhetoric proved, at best, a mixed bag. Fiorina pandered to the altruist soul of her international (i.e. European) audience by renouncing her company’s moral foundation. Jay Nordlinger, covering Davos for National Review, offered this account of Fiorina’s speech:

She says that "the fundamental objective" of her company — the fundamental objective, mind you! — is not "to make money" but "to do good," "to be a good international citizen." When she says "make money," she makes it sound so dirty. She borrows the old Quaker business about not just doing well but doing good.

Fine and dandy, of course, but I find myself wishing — not for the first time — that businessmen would be a little less defensive and more self-confident. They have nothing to apologize for. Does Hewlett Packard want to do good? Then let it invent and manufacture products that people need — or want, or that make their lives better — and sell them at affordable prices. That is doing good.

Coincidentally, an article in Monday’s Wall Street Journal regarding a possible European pharmaceutical merger noted: “The proposed takeover could rattle Europe’s clubby corporate scene, where managing companies for shareholders has never been a priority”. Fiorina’s remarks appear sympathetic to that view.

But if companies are not managed for shareholders, then who are they managed for? In Europe they’re managed for political interests, especially government-backed unions. The freedom of contract has all but been abolished in Europe. Every aspect of business is regulated by a bureaucracy, either at the national level or by the unelected, unaccountable European Union. The EU particularly despises successful businesses. European antitrust policy is far more draconian than its wretched American counterpart. For this reason, the EU openly encourages competitors to use the political process to punish those firms that beat them in the marketplace. European regulators emphasize the egalitarian principle of multiple competitors competing for the sake of competing, rather than the capitalist ideal of rewarding actual achievement.

When a company sets out to “do good” rather than “make money”, as Fiorina suggests, the result is a business that panders to political interests. This is not capitalism, or even pure socialism, but survivalism. Once you concede the right of regulators to dictate your business according to their whims, every aspect of your business is geared towards currying and maintaining political favor.

Bill Gates is the perfect example of what happens to businesses, in this political culture, that set out to make money before doing good. Microsoft spent years building its business empire without spending lavishly on political lobbyists. Meanwhile Microsoft’s competitors wined-and-dined politicians while lagging behind in the marketplace. The result was inevitable: The politicians went after Microsoft for not acting against its own interests by placing undefinable social interests above merely “making money”.

In his own Davos speech, Gates focused not on his past achievements, but on his future goals (the exact opposite of what most politicians do). For example, he vowed to eliminate spam within two years. And according to Jay Nordlinger’s account, Gates will never stop trying to improve the personal computer:

[T]here's a reason he's the richest man in the world, or at least very, very rich: It's not a matter of luck; the man is phenomenally smart and bold. He has a thousand interesting things to say, such as that the PC of today stinks. Yes, stinks. You can't talk to it, you can't do umpteen other things with it — and by decade's end, it'll be a lot better (although you know that, come then, Gates will say the PC still stinks).

But Nordlinger also says Gates has gone soft on pandering to charity. Gates talks about “giving money back to society”, to which Nordlinger replies, “You didn’t take it from society to begin with, baby. It didn’t exist there. You made it, earned it, benefiting all of humanity in the process”.

Gates understands Nordlinger’s premise, I believe, but after waging battle in the courts for nearly a decade, it seems Microsoft’s corporate culture has begun to adopt the mantra of altruist defeatism that Carly Fiorina promotes. For all the money Bill Gates has put into his charitable endeavors, he has yet to target the ethical and philosophical culture that seeks to destroy his life’s work. It’s interesting that Gates is confidant he can eliminate spam in two years, yet he’s unwilling to put his formidable resources behind eliminating antitrust, a far greater threat to man’s economic interests.

Waging war on antitrust would be the political battle of the new century. It would require businesses, big and small, to join forces against a large, well-funded establishment that has spent 100 years acquiring power by force. But at the end of the day, with leaders like Gates and Fiorina heading the campaign, the war on antitrust would be won quickly and decisively. Antitrust cannot survive even a modicum of rational scrutiny, and I firmly believe the FTC and Justice Department would crumble like Saddam Hussein’s Republican Guard. But the battle cannot be won until it is waged by businessmen who have both the material resources and the courage of their convictions.

Bill Gates needs to stop hiding behind his lawyers and lobbyists and do what he already knows is right. Carly Fiorina needs to stop appeasing European bureaucrats and decide whether she’s prepared to lead Hewlett Packard into a capitalist future. And CEOs throughout America must reassess their first principles. Do they believe it is moral for a company to put profits and shareholders first, or do they believe, as America’s political elite does, that business exists to fund public charity? How businessmen answer that question will decide America’s fate more decisively than this year’s presidential election.

But unlike an election, the war on antitrust—really, the war on altruism—will not be won in a single, decisive victory. It will be won when the altruists among us—the bureaucrats, their appeasers, and the anti-capitalist elites—are ousted from every position of authority in the United States. But before we can conceptualize victory, we must still answer the question: Who among America’s businessmen will lead us into battle? Mr. Gates, Ms. Fiorina, the ball is in your court.

 

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