Business, core values, and our collective self-deceptions

I'm Don Mayer. I teach at the University of Denver. This is lecture number seven, Business, Core Values, and Our Collective Self-Deceptions.

In this lecture, we will discuss the relationship between law, politics, and the market economy, along with how behavioral psychologists undermine the very notion that individuals and corporations can act in rational ways for their long-term interests. In doing this, we will look at some of the dominant business narratives of our time around business and free markets.

What we call business in industrialized democracies is built on a foundation of laws, laws that emerged from a complex history of political forces. Laws protect property rights, enforce contracts, and ideally, create conditions for a prospering free market economy. As economists often say, such an economy means many buyers and sellers, good or perfect information to market participants, no government subsidies, a reasonable supply of public goods, and no negative externalities. In the US and most other countries as well, there is no such economy. Subsidies and tax breaks abound, as do negative externalities, those costs imposed on others without their consent by companies that pollute air, water and land, for example. Also, there is so much consolidation that we have limited competition in many key industries. A series of mergers since 2015 have left many industries dominated by a few global giants. In the US, just four major meat companies control 55% to 85% of the hog, cattle and chicken markets. About 50 years ago, 90% of the US media was owned by 50 companies. The five companies that now own 90% of US media are Disney, Comcast, AT&T, National Amusements and News Corp. The remaining 10% that isn't owned by the Big 5 is mostly owned by other well-known corporations. In the meantime, public goods in the US, highways, ports, parks, education, government-funded healthcare, regulation and markets that preserve competition and limit negative externalities, have been consistently demeaned since 1980, and even at times defunded in the name of small government. The only exception seems to be funding for the Department of Defense.