Can American Capitalism Survive?
Ralph welcomes Washington Post business columnist, Steven Pearlstein, who asks the question, “Can American Capitalism Survive?” And economist William Lazonick tells us how Boeing management buying back its own stock contributed to the decisions that led to the crashes of the 737 MAX 8.
Steven Pearlstein is an award-winning business and economics columnist for the Washington Post, who was awarded the Pulitzer Prize for commentary for columns explaining the global financial crisis. His latest work is Can American Capitalism Survive?
“That’s the fallacy of capitalism, that there could be a perfectly objective system if the government would just get out of the way. There is no perfectly objective measure of economic contribution, except in one system, which is called ‘the jungle.’”
Steven Pearlstein, author of Can American Capitalism Survive?
“Delaware law has been the law that has been used to justify the idea that ‘maximizing shareholder value’ is the only purpose of a corporation. In fact, that’s a fallacy. Delaware law does not require that. But you would be surprised at the percentage of directors and executives and even corporate lawyers who believe that to be the case.”
Steven Pearlstein, author of “Can American Capitalism Survive?”
William Lazonick is a professor of economics at the University of Massachusetts Lowell. His article “Profits Without Prosperity: Stock Buybacks Manipulate the Market and Leave Most Americans Worse Off” earned the HBR McKinsey Award for outstanding article in Harvard Business Review. His latest works include “Make Passengers Safer? Boeing Just Made Shareholders Richer.”
“As these planes (the Boeing MAX 8s) were being sold, the executives had every reason to know that they were unsafe. Meanwhile, they were benefitting from having the best selling plane in the history of a company that’s over a hundred years old. For the top executive (Dennis) Muillenberg it was to the tune of a million dollars per month that he was pulling into his bank account from his various types of executive pay – most of it stock-based… They (Boeing executives) are putting boosting the stock price way ahead of passenger safety.”
William Lazonick, economist and co-author of “Make Passengers Safer? Boeing Just Made Shareholders Richer”