A capitalist's dilemma

[Mickey Brausch]

In the thread about Saddam, a sub-thread developed about the potential ehtical dilemmas faced by capitalists who also want to remain good Christians. Please read this post if you wnna get up to speed.

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How can I be a true believer of the teachings of Jesus and still be a good capitalist?

I'm a CEO and I must fire at least 350 employees within one month and close down two plants on whose existence the livelihood of an entire village in North Scotland depends, in order to keep my shareholders happy.

I'm in quite a quandary and the bishop is not returning my calls.

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If you are following Jesus' teachings to the best of your ability, and to the extent your circumstances allow, then I don't think God would be displeased with you. You are not capable of transforming one loaf into many loaves (or one job into 350 jobs within one month), so perhaps you are worrying too much?

[/ QUOTE ]Statistics tell me that such mass layoffs and plant closings result in severe psyschological trauma for a significant percentage of workers (sometimes resulting in chronic depression), a sudden deterioration of economic status for most, and a subsequent disintegration of the local social fabric to a varying degree (in other words more crime, substance abuse, etc). In some cases, former workers commit suicide.

Bearing this in mind and with my respect for statistics (i.e. knowing that my actions will result in some or all the above with significant probability), should I still go ahead and act like a good capitalist?

Or is there a better Christian way ?

...My bishop still won't return my calls; he seems to be avoiding me.

Mickey Brausch

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So what is your alternative? You personally don't make the jobs out of thin air overnight do you? I'm afraid I don't understand why you think there is a conflict between capitalism and Christianity in the example given.

The company no longer does enough profitable business to keep the 350 workers on the payroll, correct? By laying off those workers out of necessity you are not treating them unkindly, it is just reality that their jobs can no longer exist. If instead you were to lie to them and say "show up for work anyway" but then the comnpany didn't have money enough to pay them their wages after their next workweek, that would be treating them unkindly. But you are not about to do that (I should hope;-)).

You seem to be saying that there exists a contradiction between "acting like a good capitalist" and "acting like a Christian" but regardless of which principle you choose to guide you in this situation there appears to be nothing you can do to prevent the looming layoff. Is there some way that by not "acting like a good capitalist" you could make it so the workers could keep their jobs? If so, what is it? If not, then your premise that there is a conflict is not germane to this example, and you may be pointlessly making yourself feel guilty over a situation over which you have no control.

Actually, you probably have the greatest chance of ultimately saving the greatest number of empoyees' jobs precisely by "acting like a good capitalist" and going out and getting more business for your company. But that's another discussion.

John Kilduff

[Mickey Brausch]

<u>RESPONSE:</u>

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So what is your alternative?

[/ QUOTE ]I can always resign. Yes, someone else will do the deed, I know.

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You personally don't make the jobs out of thin air overnight do you?

[/ QUOTE ]I imagine that there's always one more mile one can walk before laying off people. I could for example spend hours or months trying to argue the case for deferring layoffs, building on our human resources, supporting the communities, etc, but that would be against my personal interest, as I could be perceived as "weak" (i.e. unable to take "the tough decisions") and possibly fired myself! Additionally, the shareholders are not interested in "long-term" benefits to the company but, rather, to the immediate and tangible Return on Equity I can provide them with.

In other words, those workers will have to be penalized for the shortcomings of the company’s shareholders and I can't stop that unless I jeopardize my own position in the company.

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The company no longer does enough profitable business to keep the 350 workers on the payroll, correct?

[/ QUOTE ]Actually, it's not that the company is losing money! I said I must close plants and fire employees "to keep my shareholders happy". In my case, this means getting our Return on Equity on a par with our competitors'. It's not that our shareholders are not making money; they demand more --and thus painful cost cuttings are in order.

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You seem to be saying that there exists a contradiction between "acting like a good capitalist" and "acting like a Christian" but regardless of which principle you choose to guide you in this situation there appears to be nothing you can do to prevent the looming layoff.

[/ QUOTE ]I think that's the best argument in favor of going ahead and chopping off those jobs, I've heard so far. That "someone else would do this anyway".

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Is there some way that by not "acting like a good capitalist" you could make it so the workers could keep their jobs?

[/ QUOTE ]Well, I have the union boss, who's a devout Catholic, arguing that what I'm doing is sinful because I will be sending those families down the road of destitution and possibly perdition (psychological disorders, economic straits, crime, weakening of faith, etc). Although he is a rather well-paid employee, he seems ready to sacrifice personal well-being in order to defend his "fellow workers'" well-being. I'm amazed.

(I also admire him secretly but then what can I do? My wife wants a new SUV. Ours is already three years old. And the daughter is now 21, which means her own apartment. Ouch.)

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You probably have the greatest chance of ultimately saving the greatest number of employees' jobs precisely by "acting like a good capitalist" and going out and getting more business for your company.

[/ QUOTE ]But those will be other people who get the "new jobs" which we will create (if we create them). Unless I persuade the workers I will fire to hold steady and wait up. It's an idea. (It will be a tough sell though. Better pitch this in my Santa uniform over the company New Year's Eve party. Let's see.)

Mickey Brausch

[John Kilduff]

It sounds as though you might be able to partially forestall, but not avert, the inevitable layoff of these employees. Your capacity, even as CEO, is unfortunately limited. For whatever reasons, the company cannot or will not continue to employ these workers. It doesn't sound as though you have any control over these facts.

So, let me ask you this: do you feel that it is somehow an un-Christian thing to be the bearer of bad news?

There might, however, be things you can personally do to help some of the soon-to-be-laid-off employees such as assisting them in other ways. That is for you to determine and you must weight any costs of so doing against your other personal responsibilities.

If you cannot reconcile your duties as CEO with your moral perspective, you might decide to quit. I personally do not feel that being the bearer of bad news is an immoral or un-Christian thing, but your perspective may differ.

[iron81]

I think what you might have to consider is that executives often have a choice when it comes to layoffs. Layoffs are not always done when a company is in dire financial straits. It might mean closing an unprofitable division in an otherwise profitable company. It might also mean simply "trimming the fat" at a profitable company or a company on a downswing that has little risk of going BUSTO.

That said, I hesitate to say layoffs are "unchristian" because I'm not that familiar with Christian philosophy. I'm sending this to SMP where they know a little more about it.

[RayBornert]

jesus was into natural selection when he suggested that things that do not bear fruit will get their roots cut by an axe.

bear fruit or perish

ray

[haarley]

Why doesn't Mickey Brausch hire all the unproductive people who get laid off? He seems to be a far greater visionary than the average businessman. Lead by example my son and report back the results.

[Paragon]

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Additionally, the shareholders are not interested in "long-term" benefits to the company but, rather, to the immediate and tangible Return on Equity I can provide them with.

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Those would be some pretty dumb investors then.

Speaking about "making investors happy" muddles reality. Investors should always be seeking to maximize long term future profits. If the best method for accomplishing this is to fire workers, then that's what they'll support and it's what the CEO should do.

Think about the mechanical loom and other inventions that first triggered the Industrial Revolution. Would the Good Christian open a new factory for making textiles by hand to support those that lost their jobs? It would be a complete misuse of human energy. Why should a company waste the labor of its workers? Let them be productive and move elsewhere in the economy.

[Mickey Brausch]

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Why doesn't Mickey Brausch hire all the unproductive people who get laid off? He seems to be a far greater visionary than the average businessman. Lead by example my son and report back the results.

[/ QUOTE ]I wouldn't have a problem, as a pure and unadulterated capitalist, to throw into unemployment millions of workers, not just a few hundred chumps. And I couldn't care less whether or not everyone deserved to get fired, not as long as my year-end bonus arrives on time for my cruiser boat instalment.

On the other hand, I wouldn't have a problem, as a good Christian, with keeping everybody on the payroll, and even hiring off the streets brothers and sisters who are in need of a helping hand.

It's trying to reconcile the two that drives me up the wall.

...If I could only buy my way out of this, the way it was arranged with the Pope in the old days.

[Mickey Brausch]

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Executives often have a choice when it comes to layoffs. Layoffs are not always done when a company is in dire financial straits.

[/ QUOTE ]Chezlaw, stop pretending to be iron81.

[Mickey Brausch]

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It sounds as though you might be able to partially forestall, but not avert, the inevitable layoff of these employees. Your capacity, even as CEO, is unfortunately limited. For whatever reasons, the company cannot or will not continue to employ these workers. It doesn't sound as though you have any control over these facts.

[/ QUOTE ]Are you saying that, because the capitalist shareholders want blood, I will have no blood on my hands? Is this supposed to make me feel better? I already told you I want to be a good Christian.

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Do you feel that it is somehow an un-Christian thing to be the bearer of bad news?

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Ah yes, the "I'm simply the messenger" thing. I always wondered about that. Can the state executioner invoke the same excuse? The execution is gonna be carried out anyway. Someone else will do it. Or how about the abortion doctor? Is he supposed to be "just a bearer of bad news" (to the foetus)? She's set on having her abortion anyway.

Mickey Brausch