Capitalism Comes in All Shapes

American capitalism is truly unique because it relies on unleashing the entrepreneurial spirit of not just organic talents, but also international talent, which views the land of opportunities as a fertile ground to nurture and grow a business. There is a reason why Facebook boasts 2 billion users worldwide, and that Airbnb and Twitter were started in the United States. That’s the good capitalism many admire around the world. But capitalism comes in all shapes, and some of the more traditional businesses have engaged in one of its ugliest forms, we call “Lawless Capitalism”.

Not all businesses that start on the right footing end up maintaining their stellar reputations. Uber, today, exploits its drivers by paying them little money while they carry the largest costs of operating their vehicles. Starbucks is fighting labor unions using the dirtiest tactics possible. Why would Starbucks resist unions if it treated their employees fairly and paid them their fair market value?

Congress and the U.S. government must do more to reign-in lawless capitalism.

THE UGLIEST OF CAPITALISM

The United States, over the last 40 years, has moved slowly into the lawless capitalism category not only through exploitation, but also by using outright fraud and criminality to achieve higher bottom line quarterly results. Book big profits at all costs regardless of their reputation, ethical standards, or the need to comply with the law has become the standard operating procedure for many American companies.

Here are some hideous examples:

1. Wells Fargo illegally opened bogus accounts using bogus names to add value to its shares, which resulted in higher pay for its executives and bonuses running in the tens of millions of dollars. Fargo is still opening phony accounts.
2. Navient used deceptive and unfair practices to swindle its student loan holders, which resulted in 36 U.S. States suing the company. Navient settled by paying $1.85 billion.
3. Purdue Pharma pushed its addictive OxyContin, which resulted in hundreds of thousands dying from overdosing. It settled by paying $6 Billions, which the Supreme Court is looking into.

Of all these cases, and many more, none of the crooked CEOs, so far, went to jail for breaking the law.

Because of the Supreme Court hearing the Purdue Pharma case, there is a chance it may hold Richard Sackler accountable for his crimes. Furthermore, only recently did Navient kick Jack Raymondi out as CEO, and Carrie Tolstedt, who is the architect behind the Wells Fargo fiasco, may go to jail. However, not because she broke the law, but because she obstructed the investigation of Wells Fargo.

Congress and the U.S. government must do more to reign-in illegal corporate practices. Capitalism comes in all shapes, but we must eradicate those impacting negatively the society the U.S. government has an obligation to protect.

This lawless capitalist period America is going through must come to an end.

LAWLESS CAPITALISM IMPACT

The lawless capitalism the United States is experiencing today is having a deep impact on our society. Besides the lack of trust in our government willing to look the other way sometimes, there is the economic impact on the middle class. When Navient deceived student loan holders, it generated illegal profits from that practice that struggling students paid for at the expense of buying a home, or raising a family.

When Wells Fargo scams its shareholders with such brazen disregard for the law, it encourages other CEOs whose greed is limitless to test such practices. So is the deadly impact of Purdue Pharma pursuing profits by killing people.

The U.S. government must hold CEOs accountable for their lawless capitalist pursuits. Booking higher profits at any cost is not a model for success in the long-run, and our society will suffer much worse consequences as time goes by.

America must go back to the pre-Reagan era, when businesses balanced maximizing profits with an implied responsibility towards protecting the interests of their customers and shareholders.

This lawless capitalist period America is going through must come to an end.

Capitalism Comes in All Shapes