> replaced by high-growth corporations whose goal is the same as all high-growth corporations, ie money and growth at the expense of everything else.
Why do people say this? It's not insightful, I guess it's like some kind of ingroup signaling?
It's also, you know, not true. The growing companies like Amazon and Uber don't make money, and the money making companies don't do things "at the expense of everything else", or else they wouldn't be in their current markets. They would be selling heroin.
and neither do the corporate owners, since the same retirement funds own all the companies that are competing with each other, and so they don't really try that hard:
> I have a theory that one of the core problems is that American businesses just expect to make too much money.
If you pay attention to certain board meetings, earnings calls, and so on, or if you had the opportunity to work for certain companies, you'll find people talking about the growth of growth, i.e. second order. It seems that the notion of sustainable growth is just gone. Corporations chasing lofty goals in absurdly short timeframes.
> Does the profit motive actually stop Google or Uber from constantly doing useless makework projects and releasing unprofitable products?
Large companies are like mini-governments with their own kind of politics. We tolerate them because despite all the useless make-work that happens in a large company, we usually find that it's still far more efficient than a bunch of smaller companies would be.
And when a publicly-traded company gets too large for its own good, corporate raiders can step in, acquire it on the cheap and spin off its parts into leaner and meaner firms. The whole process is driven by the expectation of efficiency.
> you get CEOs and big corporations who make decisions based on profit (essentially greed) because that is their entire purpose
That would be fine if you had hundreds of CEOs competing in a market. Unfortunately they tend to merge and create monopolies. And some people salute this because of the growth at all costs mindset.
What else in nature grows at all costs? Oh right, cancer.
This isn't true for any company, not even investment banks. When people start companies, money is seldom a major reason, and as they grow they get a life of their own. Even large companies are run by people, people with feelings, insecurities, ambitions.
An incredibly wealthy leader of a large corporation is not really motivated by money, he wants more status, he want to look cool, he wants to indulge his fantasies.
Saying companies only exist to make money is just silly.
> Once a company reaches a certain size, any power that individual employees wield will have been diluted to microscopic levels, and even founders' altruistic motivations tend to fade or get drowned out by the basic profit motives of an increasingly large group of shareholders.
I couldn't agree more. But at the same time, I'm completely baffled that while this sentiment about companies is widely agreed upon on HN, people around here don't expand this from companies to much more powerful and dangerous orgs: governments.
>We are to believe that corporations suddenly became more greedy than they were before?
I believe it. Companies get record profits but still initiate stuff like Return to Office and mass layoffs across multiple industries. At some point it's not about profits so much as control.
> It's asserting that they only exist to make money. Or that that is in any way natural.
There are plenty of companies that exist to make money and have additional goals.
But, gigantic, publicly traded corporations don't fall into that category, and they exist exclusively to make money. If they tell you otherwise, their PR people are trying to fool you.
I'm also tempted to say a business whose number one goal isn't making money for its owner and employees should probably be registered as a non-profit or a charity or something else, and not a corporation, but I guess there's no reason they couldn't be a corporation.
> I have never assumed that the operations of capital are autonomous and self-executing, or that executives are robots who are programmed to maximize shareholder value to the exclusion of all other considerations.
But that is how it works, right? If you don't maximize shareholder value you can be ousted, if you don't where others do you will lose in the marketplace and cease to exist. Isn't that competitive ruthlessness exactly what people like about our current system?
> Corporations exist in society, and are not above society's concerns. Businesses operate through human beings, who remain human even in their roles as CEOs. One would hope.
Citation needed, I guess. For mid-small size companies this might be the case, but evidence seems to point to the opposite of this for any organization large enough to be its own thing outside of the humans and subsystems that comprise its pieces.
> It's entirely a matter of incentives. Companies are like machines whose sole purpose is to make a profit. Pretty much everything they do apart from that (make products, employ people, pollute, etc) is, strictly speaking, a side effect.
What do you base that on? Sure corporations take on a life of their own, but there's much more to most of them than purely making profits. They're made up of humans too, and usually it's some executive making a final call. There are many corporate agendas that have little to do with profit.
The meme that corporations are purely about profit needs to die, because it encourages that exact behavior by giving free reign to morally devoid executives, IMHO. Corporations can and should also be held to account legally and ethically for being good stewards of public interests in addition to profitability. In the end they're just tools for organization, and a rather effective one, but they're still run and accountable to humans and human values.
They don't have to. They don't have to list on the stock market. They don't have to take investment money. They don't have to do anything. A company is everything from IBM to a local plumber. They don't all follow the same rules, at all.
> I actually prefer to see companies as entities such as their only goal is maximizing profits, all else be damned. They will exploit every worker and will externalize every negativity in their profit-driven mandate. And typically short term profits will trump long term anything.
They clearly don't do this though. There are less profitable and more profitable industries and companies don't move out of the less profitable ones. If they were out there exploiting anyone and everyone, they'd all be selling crack instead of furniture. Or at least mandating the employees be on it for productivity.
> Honestly, I'm not trying to sound like I'm speaking in bad faith or provokingly, but why did you ever expect the top executives of a multi-million (or in this case, trillion) dollar corporation to care about anything but profits and their own well-being? It's just like Zuckerberg said, "Company over country".
That's a common ideological outlook now, but IIRC it wasn't always so and it doesn't have to be so in the future.
Simplistic free market greed-sacks like you describe should be pariahs, and treated as such by society and the government to the point that they find it very hard to make profits.
> but what is broken is that the people who have ultimate control of large public companies (in 90% of cases - founder controlled companies are a prominent exception) are the shareholders. And these are typically not domain experts, their main interest is in making money. So they generally see fit to appoint executives whose main objective is to make money and to remove those who care about anything else.
What alternatives are there?
> Not everyone is doing that. But those who are often making the most money, and as money = power in capitalist economy, the people who are doing this are continually increasing their control of our companies over time.
The most profitable public companies seem to invest quite heavily in long term investments and have long term planning. This does not seem to square with your statement.
> was there even a time when the majority of companies didn't care so much about year-over-year growth, and weren't seen as weak if they were stable/flat?
Since the Industrial Revolution, I don't think so. Now that you mentioned it, I think the concept of "corporation" is intrinsically related to growth.
> I'm not content with that, but people seems to have the wrong expectations about what a for-profit is all about
Early in the US history, all companies existed through acts of congress and thus were implicitly for the betterment of the USA.
The theory of corporate ownership... Or at least the fashion trend... Has changed through the years. But many still hold onto the old ideals.
We live in a democracy, which means that we can change the 'purpose' of companies as long as enough Americans agree on it.
As such, your argument cannot assume a particular definition or purpose of companies. Instead, the question should be... Is the current for profit model really best for America?
I'm so tired of hearing this. Contrast this with Steve Jobs's quote:
"My passion has been to build an enduring company where people were motivated to make great products . . . the products, not the profits, were the motivation. Sculley flipped these priorities to where the goal was to make money. It's a subtle difference, but it ends up meaning everything."
Why do people say this? It's not insightful, I guess it's like some kind of ingroup signaling?
It's also, you know, not true. The growing companies like Amazon and Uber don't make money, and the money making companies don't do things "at the expense of everything else", or else they wouldn't be in their current markets. They would be selling heroin.
The CEOs don't want it to be true:
https://www.businessroundtable.org/business-roundtable-redef...
and neither do the corporate owners, since the same retirement funds own all the companies that are competing with each other, and so they don't really try that hard:
https://www.theatlantic.com/ideas/archive/2021/04/the-autopi...
Sometimes owners even want the company to stop existing:
https://www.bloomberg.com/opinion/articles/2021-05-27/exxon-...
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