Everyone please read this Facebook post “from inside Southwest.” It is spot on. It describes how the meltdown happened because the company had been stripped for two decades by executives looking for short-term profits at the expense of the company.
What it describes is not just happening at this airline, though, and not just at airlines. This is what has been happening at HOW MANY companies for a long time! But more than that, it is of a piece with what has been happening to our democracy.
All the incentives are for squeezing everything out of a company to get the appearance of profit THIS QUARTER to get the STOCK PRICE UP to get the EXECUTIVE QUARTERLY BONUS and it is all at the expense of everything else – the customers (obviously) , the suppliers, the employees, and the future of the companies.
Our government is supposed to oversee the way companies operate. They operate under RULES set up by our government.
Rather than get into the specifics of those rules, ask yourself if a government operating in the interests of the people of the country and the long-term good of the companies of the country would allow what we are seeing at SWA and so many other companies to continue? Of course not!!!
So why IS it not only continuing but getting worse and worse? The answer is in paragraph 2. Current incentives are for executives at companies to strip their companies in the short term – the long term be damned they will be rich and not working there anyway.
There are too many reasons our government lets them get away with it even though it hurts the people and economy in the long term.
It’s Happening To Our Democracy Because It Is Being Allowed To Happen At Companies – And Vice Versa
First, obviously, is corporate campaign contributions. Corporate money is supposed to be used to operate the company. PERIOD. Executives are instead using corporate funds to buy politicians to let them strip their companies.
But it is not just the politicians. The “public servants” who work in the agencies of government are supposed to be overseeing and enforcing the rules. But they are allowed to leave government and work at the very companies they are supposed to be overseeing! It is well known that if you “make waves’ and enforce regulations on the companies you oversee, you won’t be able to get a lucrative payoff position later.
Again, this all goes back to the use of corporate funds for purposes beyond the operation of the company. Executives are using corporate funds to buy politicians, fund “think tanks” and other influence operations to convince people what they are doing is OK. Example, you HEAR from these “think tanks” that companies only exist to make a profit (which makes the executives rich). NO! They are supposed to do their JOB first and foremost, and make a reasonable profit from doing their job. NOT from polluting the earth, hurting/scamming customers, exploiting employees, dodging taxes, and all the things we see all the companies doing now.
PS These “free market” “think tanks” funded with funds intended to operate corporations also tell people government shouldn’t be “regulating” – telling corporate executives not to do these things. Go figure.
And the last thing I want to say is that all companies are supposed to have Boards of Directors overseeing the management that is doing this to these companies. The Boards have RULES. They have Fiduciary Duty to make sure the executives are not stealing corporate money to buy politicians, etc. This is called CORPORATE GOVERNANCE. Boards are supposed to be HELD ACCOUNTABLE when companies operate this way. And OUR GOVERNMENT is supposed to be HOLDING THEM ACCOUNTABLE.
WHY would a functioning democracy allow these companies operate the way they are operating? WHY would a functioning democracy allow company funds to be used to bribe politicians and give big $$ to govt employees after they leave office? A functioning democracy would not. Allowing corruption has enabled more and more corruption until it has has stripped the companies and our democracy.
One last thing. A Supreme Court majority put there using the very corporate funds I am talking about ruled that this use of corporate funds is “free speech.” A corporation is a legal contract that obviously can’t “speak” – but executives can steal corporate funds to bribe politicians to put in judges to spout nonsense like that. So here we are.
Please read ‘Understanding What A Corporation Actually Is Can Help Restore Democracy‘ from Imagine Democracy.