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What The Media Tell Americans About Free Enterprise

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July 1996


Irresponsible Corporate Bashing
Guest Editorial, by John Hood

On May 16, President Clinton invited about 100 business executives to the White House to announce the new "Ron Brown corporate Citizenship Award." Clinton spotlighted 13 corporations that in his view had exhibited social responsibility by providing employees with family leave, health and pension benefits, safe workplaces, training, and policies that avoid layoffs.

As intended, this event garnered a great deal of attention and praise in the news media (naming the award after the recently martyred Brown was a crafty, if somewhat sleazy, device for attracting food press). The Wall Street Journal’s May 17 story was typical. It featured quotes from Clinton and the corporate executives being honored with only a one-sentence nod to Republican critics, who were never identified or quoted.

The latest push for so-called "corporate social responsibility" is part of an ongoing media assault on the concept of the profit-seeking business, not only in the news media but in entertainment. During the 1950s, wise TV dads like Jim Anderson of Father Knows Best and Ward Cleaver of Leave It to Beaver were an insurance salesman and an accountant, respectively. Nick Charles, the Thin Man, was a publisher, as was the Green Hornet. Bruce Wayne, a.k.a. Batman, was a rich industrialist. Even into the 1960s, TV often portrayed business in a positive light, especially in Westerns. Remember that Ben Cartwright of Bonanza ran a sprawling ranching and mining empire on the family’s thousand-acre Ponderosa estate.

But throughout the 1960s and into the 1970s, both the popular culture and public sentiment toward business underwent a dramatic reversal. Investigative journalism became a romantic calling, with the name of the game being to catch greedy corporations in the act of polluting the water, gouging consumers, and exploiting workers. On television and in the movies, business executives increasingly became the villains, who were challenged by heroic lawyers, policemen, reporters, and activists.

In a study of the hundred highest-grossing films, researchers found that nearly nine of 10 business characters were portrayed positively before 1965, but two of three were portrayed negatively thereafter. After 1975, the proportion of negative business characters rose to three of four. The same pattern held true for TV: 31 percent of business characters were villains before 1965, compared to 58 percent afterward. Compare the Cartwrights of the 1960s to the Ewings of the 1980s and you get the general point.

Public sentiment is influenced by what people read and what they see. In 1965, almost 60 percent of Americans believed that businesses made a "reasonable profit" compared with only 24 percent who thought businesses made too much. By 1975, the trend lines had reversed, with more Americans calling profits excessive than reasonable. Even in 1939, as the economic stagnation of the Great Depression lingered, 56 percent of Americans said that the interests of employers and employees were basically the same, while only 25 percent said they were opposed. But by 1994, more Americans thought the interests of the two groups clashed rather than coincided.

Advocates of so-called corporate social responsibility believe that corporations have aduty to look beyond profit and serve society. In reality, the American corporation is a phenomenally successful social institution precisely because of its focus on profit. Most new drugs for curing disease and alleviating pain come from the private sector, not the government. Workplace safety, health standards, wages, economic advancement for minorities and women - these have all been improving for decades regardless of, and often in spite of, government intervention in the economy.

Nevertheless, the corporate social responsibility movement continues to influence public opinion and public policy, mostly via the news media - particularly the network news and the New York Times, which have grown increasingly divorced from reality. They have convinced millions of Americans that we are currently in the midst of an historic downsizing of the economy, though there is actually little evidence that we are experiencing more layoffs than usual. Through irresponsible reporting on scare stories about Alar on apples, silicone breast implants and most recently start-up air carriers like ValuJet, the press has destroyed companies and jobs and kept consumers from getting what they want, which is, after all, the purpose of free enterprise.

As successful as free enterprise is, its continued survival is not a given. It is especially not a given if the American public is not adequately informed about true corporate responsibility.

John Hood is president of the John Locke Foundation and the author of The Heroic Enterprise: Business and the Common Good (the Free Press, 1996).


Rich Noyes


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