The financial meltdown, the Toyota mess, and the BP oil spill are all examples of companies acting badly. Of course, such bad behavior is not limited to these companies. Banks and credit card companies are notorious for excessive fees and brutal policies. Many companies also have a tendency to treat customers badly and this sometimes extends to illegal activity. Just do a search on Google for customer and consumer horror stories involving major companies and you will get an idea of the sort of things that occur, such as complaints against MCI. Companies also often engage in practices that serve to needlessly alienate customers, such as the latest incident with AT&T.
One reason companies behave badly is they can. The can because they often have considerable influence over the law makers and regulatory agencies that are supposed to protect the public. While the government does step in from time to time, this is most often in the truly egregious cases that make it into the media spotlight. However, misdeeds that remain in the shadows around the light tend to continue. The fix for this involves finding a way to reduce corporate influence and to get agencies and lawmakers to do what they are morally supposed to do: serve the good of the people.
Another reason companies behave badly is that they(think they) are able to make money without behaving well. In fact, executives often seem to believe that behaving badly (for example, deceiving people about bills, overcharging, or operating unsafely) is more profitable than behaving well. In some cases, they seem to be right. However, they also seem to find out that the long term costs of such behavior (such as loss of customers, bad PR, and lawsuits) can be higher than the profits. One way to work on fixing this is to ensure that bad behavior is more costly than good behavior. This, obviously enough, ties back into the problem addressed above.
A third reason that companies behave badly seems to involve arrogance and a tyrannical character. The economic power of companies tends to breed such attitudes which can translate into bad behavior. For example, CEOs might see themselves as above the law or, at least, exempt from the usual rules of good behavior. The rather undemocratic and authoritarian corporate culture probably also contributes to this sort of behavior.
The views of Hobbes and the discussion of Plato in his Ring of Gyges are also quite relevant here: people want more than they deserve and if they have the power to act badly, they will do so. As such, it is hardly shocking that large companies often behave badly.
To be fair to the big companies, their behavior is really nothing unusual. Normal folks also try to get away with things. However, they generally lack the power and resources to do misdeeds on a large scale. They also tend to lack the influence to get away with their misdeeds.
I don’t think companies act any worse than anyone else.
We live in the best time in history to live. Why is that?
Michael LaBossiere says
I’d agree. Of course, this is because I tend to agree with Hobbes and Glaucon: many people will try to get away with as much as they can, limited only by their fear of punishment.
It is the best for some of us, but not the best for all of us. Are you claiming that companies make it the best?
I’m saying that we tend to complain about the bad much more than we acknowledge the good. And yes, oil is a big reason our lives are so good. (And the companies that get the oil for us)
Schopenhaur points out that humans feel pain more than they do pleasure. At least he felt this was the case, as indicated by how much more we talk about the bad things in the world as opposed to the good. Of course one could also interpret this as occuring because pain is actually rare, so it’s easier to notice, whereas, we become numb to the good things.
Michael LaBossiere says
In the case of the spill, we have a lot to complain about.
I’l grant that fossil fuels enabled us to advance in technology and that it is the foundation for our modern lifestyle. That said, it is possible to replace fossil fuels with cleaner energy. Once, open fire served us well. But we moved beyond that. Likewise for fossil fuels.
Also, the fact that oil provides energy does not justify companies being shoddy when it comes to safety. After all, we do not say “well, fire helped us so it is okay if people burn things down now and then.”
While the oil companies get the oil for us, they get a lot of oil from public land. For free. That is, they get our oil and then sell it to us at a massive profit. That is smart business for them.
You seem to take for granted or decalre it as a given that we can replace fossil fuels. Is that totally? How long will it take, how will you fly aircraft, how will you make the enormous amounts of electricity to power all of our vehicles? Are we supposed to smash ourselves against the rocks of progress while other countries do not? If there was a better way we probably would have done it by now. You throw out “..it is possible to replace fossil fuels with cleaner energy…” like the knowledge to do so is as easy as 1.2.3. Obama’s plan is to tax the crap out of oil and coal to subsidize less efficient but cleaner energies. They would not stand on their own or support themselves at this point as energy alternatives without being forced or manipulated to do so. I totally agree that the technology will one day be here. When is the huge question. Trying to fix the oil problem by weakening the economy even more at this time is a horrible move. btw, you forgot that petroleum is used in many aspects of manufacturing and in the creation of countless products that have nothing to do with fuel. I just think the technology is not ready yet.
This is the standard liberal stance on fossill fuels: If we just pass bills and dump money on it, we’ll make a replacement fuel for oil.
Nothing comes even close to oil and nuclear. Sorry greenies.
Like the trilions that would be made on a true alternate fuel are not incentive enough.
I think the price that BP and Toyota have paid already is part of the natural wave cycle of things.
1) Do something wrong.
2) Get spanked.
3) Do better next time.
I guarantee that all of these safety violations that BP had in recent years (15 I think since 2005–that doesn’t seem like that much to me) were happening with all the big companies.
For instance, the Army security branch that I work for just recently had an inspection done. There were “violations” all over the place. And there probably will be next time around. It’s actually really difficult to keep everything perfect. All the talk about the violations only exists because of the accident.
Who’s proven the accident happened because of safety violations?
This always happens. People coming out of the woodwork after the fact. Wow. What a bunch of geniuses. Guess they should be running the show.
Michael LaBossiere says
BP has had way more than 15. Here is the break down:
760 egregious willful
I don’t expect perfection from anyone, but it is reasonable to expect that a business or organization operate at a level of professional competence.
We do not know for certain that the accident arose from safety violations. However, given what the BP employees were saying about the well, it seems reasonable to suspect that these factors contributed to the accident.
People have been complaining about BP for decades. However, the criticisms of BP are only getting major media attention because of the disaster.
I actually own stock in Philips Petroleum, so I am not against oil companies. I am, however, against oil companies that operate in a shoddy and dangerous manner.
Those numbers are slightly deceiving, as most of them occured during one incident in which an explosion killed 15 workers, and AFTER BP did not comply with a legal settlement agreement with OSHA.
But yes, they are a bad safety example. And British I might add.. 🙂
Michael LaBossiere says
That is why I am critical of BP and less so of the other companies. Most other companies seem to operate without such gross violations.
You forget that the oil companies have been too cozy with regulatory agencies. Even under Obama.
“Normal folks also try to get away with things. However, they generally lack the power and resources to do misdeeds on a large scale. They also tend to lack the influence to get away with their misdeeds.”
Think of BP as the Bernie Madoff of Big Oil.
Michael LaBossiere says
Madoff was eventually brought to some sort of justice. BP is still on the loose. 🙂
This sums up perfectly why I think you’re wrong:
Hanlon’s Razor–“Never attribute to malice that which can be adequately explained by stupidity”
I also think this adequately explains many questionable actions by both the Bush and Obama administrations.
Michael LaBossiere says
The results of malice and stupidity are so often the same that it can be hard to tell them apart. I am willing to grant that most companies do not do bad things merely for the sake of being bad. However, the willingness to do bad does seem to indicate bad character.
BP: Founding member of Cap and Trade bill,
BP is not what liberal enviro-types are trying to hint at.
“[BP is,] instead a close friend of big government whenever it serves the company’s bottom line.”
Does this mean when it can get all snuggly-ugly in bed with the Minerals and Management Service? All for regulation when they’ve got MMS in their hip-pockets?
Nope that’s definitely not what “liberals are trying to hint at”. But, shamefully, a liberal-led MMS failed to stop the horror in the year-plus that Obama’s been in office–after 8 long years of BP sweaty deep-spooning with the Bush administration.
The emergency response plans for all the major oil cos. are virtually the same. Why doesn’t Exxon stop the spill? The government should pay them to do it if they’re so much beter than BP.
They can’t. No one can. This is osmething that has not happened before. And someday, something else will happen that has not happened.
Well, we’ve covered the topics “worse ocean spills than this have happened”, and “worse [malevolent] land spills have happened,” “accidents will happen”,and now “never-before-experienced-accidents will happen”.And, if we didn’t, we should have covered the topic of BP’s many specific errors and shortcomings before the accident.
But given the seriousness of the accident/catastrophe we’d better damn well make sure BP, Exxon,Chevron, the government et al “know” how to quickly, effectively, and safely stop leaks a mile deep before another deep water well is built (or, I would contend, before another deep water well begins operations again).
Here’s something that was known before the explosion:
http://online.wsj.com/article/SB10001424052748704423504575212031417936798.html Would the valve have worked at a mile deep? Who knows? Because of BP and lack of regulation requiring its use the valve wasn’t in place on the Deep Water Horizon where its efficacy could have been put to the test.
6/17 Silliness during the Tony Hayward testimony before Energy and Commerce.
Here’s just another variation of the lame attempts to minimize the disaster in the Gulf:
“In his opening remarks, Representative Parker Griffith, an Alabama Republican said that “if we’re going to talk about the environment,” he’d “like to remind the committee that the greatest environmental disaster in America has been cigarettes.” That means, he said, that the spill is “not going to be the worst thing that’s ever happened to America.”
Griffith, who was a Democrat until last year, is now of the party of Pres. Bush (who infamously threatened to veto federal controls of tobacco). Griffith, to his credit, voted for HR 1256 which allows such controls while the majority of his new House buddies predictably voted ‘no’.
So. I’m guessing the above is transparently aimed at setting up attacks such as this:
In his opening remarks, Representative Joe Barton, a Texas Republican, apologized to Mr. Hayward for the company’s meeting at the White House on Wednesday in which President Obama pressed BP to set aside $20 billion to pay damages to Gulf Coast businesses and the costs of cleaning up the oil spill. Mr. Barton called the president’s meeting with the oil company “a tragedy” and “a shakedown.”
Certainly, the last thing we’d want would be a minimal guarantee that BP won’t back out of the promises it’s so freely making at the height of the crisis. . .
Update on Rep. Barton’s remarks:
“After his apology caused an uproar, Barton was forced to retract it or lose his post as top Republican on the House Energy and Commerce Committee.
‘He was told, apologize, immediately*. Or you will lose your position, immediately,’ a senior House Republican aide said. ‘Now that he has apologized, we’ll see what happens going forward.'”
*Soon after the political flame began charring his party’s skin, presumably.
It’s funny. It is almost like apologies mean they actually don’t think that way anymore. I like the honesty at least. The apologies always seem dishonest only because they are forced or coerced.
They had better figure out a way. There are estimates that there are billions of barrels of oil in that hole. I’ve heard many estimates but 10 years was one I heard that this could go on for. I suspect that eventually they will have enough relief wells around it that the pressure will come down enough to stop the flow from the damaged well. The Ixtoc disaster that was similar and even deeper off of Mexico was stopped. The did something like pouring lots of rocks, lead and mud on top of it and eventually it stopped. again, numbers are all over the place but Ixtoc was 2 to 3 times worse up to this point in time. That company only paid 100,000,000 in damages and I don’t think they paid for any of the damage to the US.
“That company only paid 100,000,000 in damages and I don’t think they paid for any of the damage to the US.”
That doesn’t sound too fair. But, then, that’s Mexico, not the United States. And Pemex is a state owned Mexican company. . . What I’ve read is that the depth of the two wells is not comparable at all, Deepwater being ‘much’ deeper.
Lorette Daulton says