As regular readers know, I am currently at work on a project dealing with corporate purpose in a populist era. I've spent much of the last year immersed in the populist literature ranging from that of the People's Party era through the Southern Agrarians and into the modern tea party and Trump populists. There is a great deal of discussion in that literature about the need to reform big business.
When one turns to the specific issue of corporate purpose, however, there is relatively little discussion of it in the populist literature. One important exception was the early 20th Century work of Thorstein Veblen, who argued that the corporate separation of ownership and control allowed managers discretion to pursue socially responsible activities at the expense of profit maximization. In addition, a number of Southern Agrarians criticized corporate directors and managers for failing to be socially responsible, especially with respect to the rights of workers. In particular, Lyle Lanier endorsed the view that corporate managers should “be induced to operate them with greater regard for the public welfare.”
Beyond these few examples, however, the populist literature is largely bare of discussion of corporate purpose. Indeed, other than some scattered Tea Party opposition to the corporation’s constitutional status as a legal person, today’s populists have shown little interest in the sort of legal reforms advocated by their predecessors. Unlike left of center populists and progressives, moreover, neither Tea Party nor Donald Trump’s supporters have shown interest in encouraging voluntary corporate social responsibility.
This is somewhat surprising. Neither the Tea Party nor the Trump administration are as committed to big business as were Republican voters and politicians in the past. They also have good reason to demand a higher degree of social responsibility on the part of business, especially with respect to workers. As I will discuss in the paper, since the Buchanan campaigns in the 1990s, populism has been convinced that large corporations and crony capitalism are undermining America’s exceptionalism and America’s national identity through globalization, while simultaneously impoverishing working class and while enriching financial and technology oligarchs. As I will also explain, this concern reached a peak in response to the post-financial crisis bailouts.
At a deeper level, the globalization of big business and related economic trends have left many modern populists behind. The top third or so of Americans who are skilled, college-educated workers and managers in successfully globalized industries such as finance, technology, and electronics have done well. The bottom two-thirds are low-skilled workers whose jobs have been lost or threatened by globalization and technology. Foreign trade, foreign direct investment, immigration, and declining union participation have also played a role in their declining fortunes. Neither the government nor big business have seemed able or even very interested in addressing their concerns, which contributed importantly to the rise of the Tea Party and the success of the Trump campaign.
In sum, it would not be very surprising if modern populists confronted with cases like the Carrier fight discussed at the outset did not insist on corporate directors and managers behaving in ways the populists regard as socially responsible. Indeed, one might even expect them to follow the lead of their left of center populist and progressive counterparts and insist that the law mandate such behavior.
But they have not. And I find that odd.
The anti-populists among you will doubtless say that that's because modern populism is just an astroturf phenomenon--big business flying under a false flag. And there's doubtless some truth to that argument. But it overlooks the genuine core of anti-business anger out there among the people who voted for Trump.