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PeakTrader said...

There may not be much free enterprise to defend. Here's something I heard on the radio that I had to look up:

TrimTabs Says Americans Increasingly Relying on U.S. Social Welfare Programs for Income
March 08, 2011

In a research note, TrimTabs highlights that government social benefits —including Social Security, Medicare, Medicaid, and unemployment insurance—were equal to 35% of all private and public wages and salaries in the 12 months ended January, up from 10% in 1960 and 21% in 2000.

“We think very few market participants understand that the economy has become heavily dependent on government largesse,” cautions Schnapp. “We are hardly convinced that the recovery can persist without outside aid, so we expect the Fed to roll out QE3 shortly after QE2 ends at the close of June.”

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PeakTrader said...

"Corporate Social Responsibility" is what more Americans want, even when it means lower wages, higher prices, and bigger profits. Afterall, it sounds good.

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Pan said...

Every country that has attempted to implement Milton Friedman's ideas has enriched a few at the top and eviscerated the middle class.

Our first social responsibility is to recognize the abject failure of Friedmanomics in the real world.

Only then can we discuss whether people matter, or only numbers.

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PeakTrader said...

Peter, I mean Pan, does the number of starving people matter?

Have you recognized any "abject failure of Friedmanomics in the real world" yet?

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Klockarman said...

I find Friedman's argument kind of anti-libertarian. Let me explain: Friedman (a disinterested third party) is effectively chastising a company who is voluntarily practicing "social responsibility". The Target corporation is not being coerced into sharing it's profits with charitable organizations, it's doing it voluntarily, and if any of their customers or shareholders don't agree with Targets choice, then those customers or shareholders can surely spend their money on products or stock shares of Wal-Mart or some other retailer. Nobody is being coerced to do anything; everyone is engaging in voluntary activities, so what's the problem? Friedman may think that practicing social responsibility is not the wisest business decision for the long term profitability of Target (or whatever company he was really writing about in 1970), but if he's not a shareholder of said company, his opinion really shouldn't matter a whit.

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PeakTrader said...

Klockarman, the objective of a firm is to maximize profit or value, which tends to cause efficiencies in production. So, consumers can buy better products at better prices.

Typically, a small stockholder only wants to make as much money as possible. He may not want corporations to jump into social responsibility bandwagons.

Why should a corporation decide to take 5% or 50% of his profits for ideas of social responsibility, unless they were to make more profit, which would be deceptive (as Friedman stated).

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