8. Private property without social obligation: Workers and society are the losers
Here the argument is that the sole purpose of business is the pursuit of profit and that this excludes any form of social responsibility to its workers, its community or its nation, as this would entail costs that would reduce profits. History is replete with examples of such single-mindedness: land grabs in the Amazon, worker intimidation and exploitation by United Fruit in Central America, and forced labor by thousands of Asian workers on major construction projects in the United Arab Emirates.[23] In the April 2010 U.S. coal mine disaster in West Virginia, which killed 29 miners, it is clear that the company ignored safety regulations designed to protect its workers in an effort to minimize costs and raise profits.
Today, agricultural land grabs appear to be accelerating as large corporations buy or lease huge tracts of land in poorer countries for agricultural production and export. For example, China has purchased 2.8 million acres in the Democratic Republic of Congo, and India has invested $4 billion in Ethiopian agricultural land. At the same time, financial institutions and agribusinesses are chasing land as an investment in the expanding biofuels market, driving up food prices in the process. Poor governments are often too eager to comply, offering up what they deem “idle” or “unused” land, but which is frequently inhabited and farmed by indigenous populations. Hundreds of these controversial deals have been reported in the media. The International Food Policy Research Institute estimates that 49 million acres of farmland were the subject of purchase negotiations between 2006 and 2009. Land rights advocates, farmers’ and peasants’ groups, and nongovernmental organizations argue that these land deals spur an assortment of negative consequences, including ecosystem destruction, worker exploitation, loss of livelihoods, food insecurity, and market distortion toward agribusiness and global trade.[24]
Arguments in favor of increased social obligation by business include a favorable public image, better community relations, compliance with prevailing social norms, a deterrent to government regulation, the application of presumed private sector innovativeness to social problems, and a belief that business should return some of its profits to the community. These considerations have undergirded the movement towards greater corporate social responsibility that emerged at the end of the 20th century.[25]
Arguments against the assumption of social responsibility by business are that it interferes with profit maximization, is not cost-efficient, requires social skills that the private sector has not developed, undermines business objectives, lacks appropriate social accountability mechanisms, puts its public image at risk with the possibility of failure, and circumscribes competitiveness. In addition, opposition is often fueled simply by greed.
At this point, the question of corporate social responsibility seems to be gaining ground in the United States and most other developed countries, where many corporations have assumed a certain minimum role of social responsibility and seem likely to expand it. Developing countries may gradually fall in line as the result of social pressures, globalized business practices and human rights or environmental protection activism. Whether motivated by selflessness or self-interest, some degree of social responsibility seems to be increasingly necessary for life in an interdependent world.
Links,
I invite readers to also read “Good Capitalism Bad Capitalism, and the economics of growth and prosperity” available at the following URL: http://www.acton.org/pub/religion-liberty/volume-17-number-4/good-capitalism-bad-capitalism-and-economics-growt
Another good source of information on the subject of capitalism and socialism is a video presentation entitled Rev. Robert A. Sirico on Socialism and Social Justice, available for viewing online at: http://vodpod.com/watch/3357265-rev-robert-a-sirico-on-socialism-and-social-justice