The last chapter of Tyler’s Big Business is called “If Business Is So Good, Why Is It So Disliked?” At risk of seeming narcissistic, this passage put a big grin on my face:
Perhaps in part because we cannot do without business, so many people hate or resent business, and they love to criticize it, mock it, and lower its status. Business just bugs them. After I explained the premise of this book to one of my colleagues, Bryan Caplan, he shrieked to me: “But, but . . . how can people be ungrateful toward corporations? Corporations give us everything! Corporations do everything for us!” Of course, he was joking, as he understood full well that people are often pretty critical of corporations. And they are critical precisely because corporations do so much for us. And do so much to us.
Does my colleague’s outburst remind you of anything? Well, immediately he followed up with this: “Hating corporations is like hating your parents.”
Hmm. Your parents too (usually) have done lots and lots for you, but—especially in America—large numbers of people are unhappy with how that all turned out, or at least some parts of it. For all of their gratefulness, they resent what their parents have done to them.
On reflection, though, my “Hating corporations is like hating your parents” quip misses a crucial point. Namely: In the absence of extreme abuse or neglect, virtually every society condemns hating your parents! When you retrospectively rate your parents, you’re supposed to forgive even serious character flaws and obvious cruelty with, “Well, mom did her best” or “Well, dad loved us in his way.” When you rate a business, however, almost no one expects you to give it the benefit of the doubt.
You could object, “Well, we hold large impersonal organizations to higher standards than familiar individuals.” But that’s utterly wrong. Governments are large impersonal organizations, and people hold them to absurdly low standards. They’re even willing to brush mass murder under the rug. Churches, too, are large impersonal organizations, and people also hold them to shockingly low standards. Many Catholics briefly punished their Church after massive sexual abuse scandals, but virtually none cried, “These child molesters can go to hell; I’m finding a new religion!” Note, moreover, that government and organized religion aren’t two itsy-bitsy counter-examples. They are by most measures the oldest and largest kinds of large impersonal organizations.
Tyler spends many pages developing a specific version of the “higher standards for large impersonal organizations” story:
[P]eople tend to anthropomorphize even when such attributions are inappropriate. Along these lines, we tend to think of corporations as being like people and we tend to judge them by the same standards that we use to judge people, whether we seek to do so consciously or not. To some extent we are bound to talk that way, but we need to understand that it can mislead us, and it is a kind of shorthand that has pitfalls and hazards if we take the metaphors too literally or allow them to drag around our emotions too much. It is simply very hard for most people to think about corporations without investing them with the personal attributes of human beings or at least the attributes of those small groups of social allies and enemies we evolved to obsess over.
Since the general story is utterly wrong, however, there’s no hope for Tyler’s specific version. If he were right, people would also anthropomorphize governments and churches, leading to unfairly harsh judgment. In fact, however, governments and churches enjoy overwhelming deference even when they’re engaged in vile crimes. We damn the dollar, yet honor both throne and altar.
What’s really going on? I’ve spent many years highlighting mankind’s anti-market bias: our irrational pessimism about the social benefits of markets. I’ve even argued that this bias provides the common core of leftist ideology. Scapegoating business and the rich comes naturally to psychologically normal humans – and big (≈ “rich”) business is one of the best scapegoats of all. The only better scapegoat, really, is foreign big business – those beastly multinational corporations you keep hearing about.
Why do human beings have this corrupt emotional make-up? I sincerely don’t know. While I’ve heard Darwinian explanations, most seem like shaky just-so stories to me. All I know is that human beings do have this corrupt emotional make-up. And that’s why we I hope Big Business inspires a chorus of imitators – because our emotional corruption is not going to fix itself.
READER COMMENTS
Mark
May 6 2019 at 9:57am
I would say that people hold *their own* government or religion to absurdly low standards. People often hold governments or religions they perceive as “them” to much higher standards.
Perhaps the issue is that people hold impersonal entities that they are a part of to a very low standard, and people feel a part of their government or church in a way that they do not feel apart of large corporations. People who do feel a part of large corporations like their employees or major shareholders can often be apologists for “their” corporations.
Henri Hein
May 6 2019 at 7:39pm
I don’t think that is quite right either. I am somewhat puzzled as to how big a pass people are willing to give, say, the current Venezuelan government, or the disastrous policies of China’s government under Mao.
Hazel Meade
May 7 2019 at 1:04pm
That’s an overlapping factor. People tend to hold things they are a part of to a low standard, and for some people that thing is ideology, political tribe, not just religion or government.
Nations, religions and ideologies tend to overlap, so sometimes you find people in the US sympathizing with people of the same ideology or religion in other countries. You can bet that the supporters of the Venezuelan regime are not Venezuelan nationalists – they support it because of political ideology. If it had a different regime, they would stop supporting it. So I think Mark’s argument still stands.
MarkW
May 7 2019 at 1:14pm
People give passes to governments and religious organizations they perceive to be of their tribe (or allied with it). So it’s no surprise that many lefties tend to give Venezuela a pass. But this actually can extend to big business sometimes as well. By successfully branding itself as a brand for creatives and intellectuals and allying itself with progressive causes, Apple Computer has long been a master at this. But it’s not easy to pull off and maintain. Google was closely involved with the Obama White House, but once Obama and Eric Schmidt were off the stage, the tribal-ally armor didn’t last long. Or consider Bernie Sanders and Ben & Jerry’s. Bernie has worried about too many kinds of deodorant and shoes, but curiously never about too many flavors of ice cream. Ben & Jerry’s has been a wholly owned subsidiary of Unilever for almost 20 years, but it’s tribal-ally armor seems to be still in place.
Hazel Meade
May 7 2019 at 1:14pm
I agree, and I think, to put it more precisely, the issue is that religion and nationality are central to people’s identity, whereas in most cases corporations are not.
People identify themselves with the US government, or with a religious organization – the institution is an extension of themselves. They don’t generally identify with corporations, and when they do they are equally forgiving. I think the best example I can come up with is maybe sports fandom or “Marvel vs. DC Comics”. For some people fan loyalty can be central to their identity, and they’ll judge their own team less harshly than other teams. But still those people are pretty rare and generally considered a bit weird, even among casual sports fans.
But you can sort of see a parallel, where when people criticize the US government some people take it personally – you’re not just criticizing the state, you’re attacking them, as an American. People don’t take it personally when you criticize corporations, except in these exceptional cases like sports teams, because they don’t identify with corporations in the same way. And when you criticize someone’s sports team, an extreme fan will take it very personally – do that in the wrong bar and you can start a fight.
Nick
May 7 2019 at 5:50pm
Solid point about identity. To this I’d add another anthropological possibility: that people have an instinct to think about governance as about the people in power, rather than the institutions which regulate the people in power. So we think about corporations for their stated purpose (profit), not their end result (material prosperity).
It’s not natural for homo sapiens, which grew up in bands of <150 where they intimately knew personalities, to think of power relations in terms of rules/institutions. It made more sense for us to evaluate the leader as, “Is he a fair-hearted ruler?” than, “Will our institutions constrained him per the median voter theorem?” Why is it easier for us to do this? Probably because we didn’t have to think institutionally in the tribal setting, so we didn’t evolve to.
Now let’s say you’re one of those that think we developed an intuitive aversion to concentrations of power (I’m one). If we also learned to think about power as personalities, not institutions, then our distrust of power will take the form of distrust of motives/interests. Not of institutions. Take the last GoT episode. [Spoiler] Varyes and Tyrion debate what person should hold the throne, not about what system of gov’t might regulate that leader’s baser instincts. And I loved it. Thinking about my leader’s personality/motives is more natural than talking about separation of powers or something boring like that.
So if corporations are concentrations of power (which humans have intuitive inclinations to view suspiciously) and they’re open about their for-profit motive, then of course people view them suspiciously. Cruel gov’ts, ineffective non-profits, corrupt religious institutions are cloaked in purported beneficence, altruism, empathy. Whether they work or not, do good or bad, they’re reason for existence is not openly selfish. Thus they’re danger doesn’t register with our power-aversion intuitions. That makes it hard for our human hardware to recognize that the organizations most successful at alleviating human poverty are actually our for-profit institutions, because they’ve been carefully calibrated by our legal systems to align diffuse interests toward socially beneficent ends.
Rafael
May 6 2019 at 10:26am
I would say that people developed this instinct against rich people and big business (which is essentially groups of rich people) due to the fact that mankind was organized in small tribes for most of pre-history.
During this tribal period, to minimize risks, all members of the tribe shared the fruits of their hunts with the others. After living tends of thousands of years in that way, leads people to develop the feeling that people with large amounts of wealth are “evil” for (implicitly) not sharing their wealth. Modern impersonal societies based on anonymity and private property are in direct contradiction with these tribal instincts.
Frank Fuzz
May 6 2019 at 12:24pm
One quibble: it seems to me that American corporations are scapegoated more than foreign corporations. I think part of the anti-big-business mindset stems from anti-Americanism.
Hazel Meade
May 7 2019 at 1:20pm
I think it’s the other way around. Anti-Americanism evolved out of anti-capitalism. As the leading defender of capitalism during the cold war, America was always enemy number one to the radical left. And thus the left had to manufacture criticisms of every aspect of American society, largely rooted in criticism of it’s capitalist markets – from its vulgar pop culture to having too many brands of soap. Anti-americanism may have taken on a life of it’s own, but it coheres around a fundamentally leftist core.
john hare
May 6 2019 at 12:42pm
I think envy plays a part here. A lot of people I have known dislike success in others. Many people seem to equate finding flaws in others as somehow boosting oneself. Us vs Them. Govt and church is far more likely to be seen as us, while business is far more likely to be a them.
Political mud slinging at the personal level. As long as there are people that believe that tearing others down is equivalent to building me or us up, they will find or make villains to tear down.
Rajat
May 6 2019 at 5:36pm
I don’t think people anthropomorphize corporations per se. I think it is simply deeply ingrained in human nature from our primitive days to value caring and sharing attitudes and behaviors and to be suspicious of those people or institutions exhibiting obvious self-interest. Adam Smith’s insight regarding the irrelevance of benevolence to what we receive from the butcher and baker, etc, does not come intuitively to nor is accepted by most people’s brains. Economists accept it only because we tend to have fairly rare personality types and study the effects ad naseum. This is why independent restaurants and boutique butchers and bakers carry on about caring for their customers and loving cooking, baking or doing whatever to make their customers happy. Any small baker who says they are in it to make money would be treated as a pariah. Conversely, most people seem to accept that politicians and clergy want to help others rather than aggrandize themselves.
Hazel Meade
May 7 2019 at 1:36pm
This is also correct. For all the truth in the “invisible hand”, it conflicts with people’s natural instincts. No business is going to do well by advertising that they are maximally self-interested. They do well by advertising that they are biased in favor of giving you a better deal than is strictly rational. In fact a large amount of politicking and marketing is a reputation game, where people spend a lot of time trying to convince the customer that the seller is NOT self-interested. Politicians and religions are just operating on a way higher level in this respect than corporations. It’s like politicians and religions are chess grandmasters at the reputation game, and corporations are clueless beginners.
Henri Hein
May 6 2019 at 7:46pm
I have also noticed, and been puzzled by, the discrepancy in how people evaluate government and non-profits (not just churches), versus the derision heaped on corporations. People seems to have an irrational, unfaltering public interest view of government. Even someone who agrees that most, almost all, past government programs and regulations have been wasteful and even counter-productive will insist that their idea for a program or regulation will work much better.
Miguel Madeira
May 7 2019 at 6:47am
“Governments are large impersonal organizations, and people hold them to absurdly low standards. They’re even willing to brush mass murder under the rug. Churches, too, are large impersonal organizations, and people also hold them to shockingly low standards. ”
Are you really sure of that? At least in Southern Europe, anticlericalism and distrust in government is rampant.
And no, distrust in government is not contradictory with wanting more public services and welfare – one classical argument that the “man of the street” use to defend some public program that they want is, exactly, some variant of “the alternative to spend the money in [program X] is the money being stolen by them, the politicians and their friends”
Philip Jameson Graber
May 7 2019 at 1:20pm
I think probably both you and Tyler are missing the mark, here. Purpose, message, and intentions are much more valuable to people than you seem to think. The reason people don’t bail on the Church when the leadership does something awful is that they still believe in the gospel, in the message of Jesus, in the mission that the Church claims to have. Likewise, the reason they hold their government to low standards is that they hope to use government for their own purposes. (Look at polls of millenials asked about whether they trust government. Most say they don’t, yet they favor big government policies. This is not a contradiction.) Even our parents get this same sort of treatment, as you yourself said: “They meant well…”
By contrast, I don’t think most people accept that big businesses have worthy goals or intentions. They see profit maximization as an inherently suspicious purpose. I don’t think that suspicion is entirely unfounded.
Dzhaughn
May 7 2019 at 3:07pm
Unlike businesses and ngos, State (and historically Church) are not anthropomorphized because there is necessarily only one of each. Instead, those institutions are (mistakenly) treated as deities. To me, this goes some way to explaining the greater tolerance for misdeeds; individuals demand respect when they have a right not to participate, but you can’t negotiate with a judge, but only appeal to one.
Bob
May 7 2019 at 3:48pm
Bryan,
I’m struggling with this post. People don’t hold their own religion to a high standard because religion is part of their identity. Same goes for political party and country. People are ridiculously critical of government when the other party is in power- again identity. Big Businesses are generally not associated with our identity. Big Businesses are motivated almost entirely by profit, which may or may not coincide with our interest. We quite often do not have the practical option of not dealing with big businesses. We don’t owe them a thing. Beyond that, they often do bad things. They deploy significant resources in the pursuit of rent seeking and captured economy. We often have little recourse when they do us harm. I see little reason to hold business to a lower standard than government or religion.]
Finally, corporations sell us everything- not a lot of giving going on.
citi.zen
May 7 2019 at 4:19pm
The dollar, throne and altar get differential treatment – but that is not surprising. Each of those chosen professions / paths brings with it various amounts of money. So we are used to offering a “compensating differential” in… “sympathy” or “approbation” to those taking the paths that do NOT earn you that much money.
Of course reality is complicated and sometimes people on the throne / altar also get the dollar. But in those cases we tend to sanction them (rich dictators don’t get that much approbation).
Harun
May 7 2019 at 7:12pm
I’ve noticed that if you discuss athletes or pop stars or movie stars, the people who normally hate the rich, do so at much lower rates.
So wheras they’d be very upset at a CEO or banker making millions, its fine when its Adam Sandler.
Alice
May 8 2019 at 3:36pm
Perhaps celebrities work hard at garnering admiration, while CEO’s are busy creating jobs and managing productive innovations?
Jim Birch
May 7 2019 at 10:18pm
Corporations actively market themselves as Our Loyal Friends (leveraging the social brain implication that we should return loyalty) is a part of the problem. When a price goes up, you don’t feel like you are presented with a changed economic choice, you feel like your friends have ratted on you.
Mark Z
May 7 2019 at 11:01pm
People just naturally view economic transactions as intrinsically inferior to other kinds of interactions, giving, sharing, etc., so I think the fact that governments, nonprofits, and churches that do not (in theory) exist to exchange with others for their own benefit automatically places them above corporations in people’s instincts. Even inasmuch as they fail to live up to these aspirations, they still have ‘prosocial’ aspirations, whereas corporations, by construction, are ‘antisocial’ (unconscientious, merely pursuing self-interest).
I think there are probably valid innate or cultural reasons for this suspicion: when judging people in small communities, who to interact with, let in, keep out, etc., it may make sense for people to be wary of self-interest and prefer altruism. Even if the self-interest is productive or the altruism harmful, the latter may be interpreted as signalling one’s willingness to subordinate self-interest for the sake of cooperation, and the former as the opposite. Inasmuch as people anthropomorphize corporations in their minds, this may in part explain the difference in attitudes. Really, the core reason I infer why people hate corporations but love government, or why they view working for the private sector as almost innately morally inferior to working for the state (in research, for example). Private sector employees are ultimately selling something. Government employees are giving something. And instinctively, giving > selling. Even if what’s being sold is a cure for a disease and what’s being given is a hand grenade with the pin pulled out.
Another Mark
May 7 2019 at 11:55pm
I think you will look in vain for why people in general trust government more than business because they don’t. I think surveys still show that trust in political leaders is lower than in business leaders. For a generation big government has been much more effectively used as a scapegoat than big business.
I think people in general seek scapegoats. Some people are more biased against people who want to make a lot of money, and others are more bothered by people who are more motivated by power. And others still are bothered by people not in their community seeming to get ahead.
I think it can still make sense to support policies that constrain large businesses in various ways without having to believe the companies are evil; just as you can be glad to have them without assuming they are altruistic or kind.
Jeff Haymond
May 8 2019 at 9:08am
Brian
Several big differences between the church and government. Those within a church have at least some level of a Christian worldview that begins with the dichotomy that we are all created in the image of God and yet fallen. This allows the Christian to believe that every institution is going to have people capable of monstrous wrongs (their secret sins that ultimately are not secret), and yet it is not systemic to the institution itself, but only systemically possible from the individuals within. It is entirely possible that with the aid of God and people in the church acting according to His standards that only good results could happen. Moral failures by individuals break that good result down, although I would join many in arguing for the general good that the church (both catholic and protestant) have done since its inception.
Contrast this rationale with government. As you know, government–even if there are absolutely no moral failures–cannot serve well because of the knowledge problem. And with public choice rationale included, which does not involve moral failure at all–just standard self-interest motivation, governments will routinely perform low.
Nevertheless, I do think that the institutional church (which is not the same as the true church) is being held accountable. Ireland is one such example, when in one generation a country has left the Catholic faith due primarily to the clergy sex scandal.
Yet in almost no cases do we see governments held accountable.
Felix
May 8 2019 at 9:21pm
One difference between parents and corporations is there are a lot of corporations to choose from but only two parents.
It would be interesting to poll people and tally up the corporation hatred. Are some hated more than others? Is it related to size or visibility?
Daniel Morgan
May 10 2019 at 10:08am
Perhaps the difference is that people spend significant time negotiating with and competing with corporations, often at a massive disadvantage. With God and Government, you get what you get and you don’t pitch a fit.
Chris S
May 11 2019 at 10:53pm
‘Many Catholics briefly punished their Church after massive sexual abuse scandals, but virtually none cried, “These child molesters can go to hell; I’m finding a new religion!”’
To be Catholic is to believe that Catholicism is true. It doesn’t require a high opinion of all priests. Leaving the Church because of the sex abuse scandals would be like not quitting bicycling because Lance Armstrong was a cheater.
Would Bryan would reconsider his libertarianism, if he discovered that Michael Huemer was guilty of some terrible crime?
I wish Bryan would put on his Turing Test hat and think more carefully about how believers perceive their relationship with their faith.
Also I would ask Bryan, who is normally scrupulously fair and careful, whether their is any evidence that priests have higher rates of sex abuse than teachers or other clergy: https://www.newsweek.com/priests-commit-no-more-abuse-other-males-70625
Comments are closed.