On Monday 3/16/2020 the morning internet greeted me with the truly embarrassing story that the US President had tried to "poach" ... I think that is a polite way of saying bribe ... German scientist working on a vaccine for the Corona virus. He wanted them to develop a vaccine exclusively for the US. What part of 'we're all in this together' doesn't he understand? None of it. This is pure capitalism in action. Karl Lauterbach, a senior German politician and professor of epidemiology, said in response to the report: "The exclusive sale of a possible vaccine to the USA must be prevented by all means. Capitalism has limits." (i)
I'm fairly certain that when Professor Lauterbach said 'capitalism has limits', he was addressing the selfishness and greed that is always at the core of capitalism. I hate to break the poor professor's bubble, but there is no limit to capitalism's selfishness and greed. I'm sure Herr Trump is probably wondering why the Germans are getting so excited. He was just acting like a capitalist. How many news and FB articles have you seen today about someone buying all of the toilet paper or hand sanitizer in an area and wanting to sell it at an outlandish price? One man asked $50 for a $5 bottle of hand sanitizer. Such behavior is capitalism at its worst. Apart from its innate instability, there are no limits on capitalism.
Some people believe that corporations are required by law to do everything legally possible for profit. I did some checking. According to an article by the Cornell Law School, (ii) corporate directors are not required to maximize shareholder value. As the U.S. Supreme Court recently stated, "modern corporate law does not require for-profit corporations to pursue profit at the expense of everything else, and many do not do so." ( BURWELL v. HOBBY LOBBY STORES, INC. ) When the majority justices write "many do not do so" I must assume that they are considering all corporations, including the S-Corps and LLCs, which are the small mom-n-pop companies. If we limit the focus to the C-corps we find on the stock exchange, I would have strong doubts about the veracity of that claim. Have you ever seen a corporation do anything that wasn't profit driven? Even giving to charity works as both a tax break and advertising. One article Cornell quoted claims that the profit-above-all mentality is "the product of the pressure that activist shareholders, stock-based compensation schemes and financial markets impose on corporate directors." (iii)
I must admit to some serious skepticism regarding this claim. I don't doubt that there is pressure from those sources. After all, they themselves are an integral part of capitalism. Profit is the primary purpose of a capitalist business. How immoral the business behaves is dependent upon the level of greediness of the management and stockholders. When we are confronted by the reality that one-percent of the population owns 44% of the entire world's wealth, (iv) we can hardly deny that we are witnessing unfettered greed.
And that brings us back to the ignoble Mr. Trump. This has always been his business style. While there may be no legal mandate for a corporation to put profit above all, there likewise is no legal mandate to behave in a moral manner. While much of the world is aghast that Trump would so blantantly attempt to corner the market on a vaccine so desperately needed to address a pandemic that is killing thousands all around the world, my only question is whether or not he was attempting to do this to line his own pockets.
FOOTNOTES:
(i) Colson, Thomas and Andrew Dunn (3/15/2020). Trump reportedly tried to poach German scientist .... Business Insider Magazine on-line.
(iv) Credit Suisse Global Wealth Report. 2019.
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