Michael Novak - Capitalism and the Corporation
Case study: Michael Novak: Capitalism and the corporation The problem investigated is the growth of corporations and capitalism to the extent that they become unavoidably inseparable in order to maintain a cohesive, civil society. Corporations have been with humanity since the beginning of organized government. Capitalism can be loosely defined as the economic freedom to allow for the building of wealth, both individually and corporately. In order to provide for that freedom, governments must be in one accord with corporations to that end. Adam Smith’s writings tell us in the course of history that countries may finally become a “Nation of Commerce” as part of a natural progression. He further suggests an individual’s economy is inevitably woven into the fabric of society and that fabric should be allowed to grow without the interference of politics, which we can fairly judge as governments of all kinds (Smith, 1776). To this point, both Smith and Novak concur that, “sources of private capital and private wealth, independent of the state, are crucial to the survival of liberty”. (Novak, 1997, p. 32) The American corporation faces the responsibility of creating a social good beyond the four reasons given by Michael Novak.
First, it creates jobs. Second, it provides desirable goods and services. Third, through its profits it creates wealth that did not exist before. Fourth, it is a private social instrument, independent of the state, for the moral and material support of other activities of society. (1997, p. 32)
An emphasis on the fourth reason is essential as it is a significant role of the corporation. It is a critical part of the trustworthiness placed upon it by the affected society. One must take issue with Novak’s statement, “Absent the financial resources of major corporations, civil society would be a poor thing indeed” (1997, p. 32). He presents this in a condescending, arrogant notion that societies cannot be separate from corporations. When
First, it creates jobs. Second, it provides desirable goods and services. Third, through its profits it creates wealth that did not exist before. Fourth, it is a private social instrument, independent of the state, for the moral and material support of other activities of society. (1997, p. 32)
An emphasis on the fourth reason is essential as it is a significant role of the corporation. It is a critical part of the trustworthiness placed upon it by the affected society. One must take issue with Novak’s statement, “Absent the financial resources of major corporations, civil society would be a poor thing indeed” (1997, p. 32). He presents this in a condescending, arrogant notion that societies cannot be separate from corporations. When
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