Nothing Personal: The Triumph of Corporate Thinking

"They screwed me over,” Mike said.

We were at one of those seminars where professionals earn a couple of continuing education hours over a long lunch. I hadn’t seen Mike in a few years and asked if he was still at the same company. Not since April, he said. After well over a decade the company had cut him loose. (The company laid me off in 2002.)

Mike used “they” to describe the corporation that discarded him, as if the executives who laid him off had betrayed him. As if he would have made a different decision in their position. As if there was some “they” there. As if any corporation actually shares his core values.

It is easy to anthropomorphize modern corporations. We experience them through our colleagues, through conversations around the coffee pot or the lunch table. Yet like clockwork, we express surprise when corporations behave towards employees in a fashion that seems decidedly inhuman. In fact, they never were human. Employees simply reinforce that illusion.

Rolling Stone’s Matt Taibbi had the quote of the year with his description of Goldman Sachs as “a great vampire squid wrapped around the face of humanity.” The image recalls the Alien parasite that uses humans as incubators and then discards their carcasses once they’ve been used to perpetuate its species. Like that parasite, the modern corporation operates at the level of appetite and instinct. Its habits reflect the cold-blooded logic of self-preservation, of the bottom line, of the Christmas layoff, of the hit man. Business is business. It's nothing personal.

Conceived in law and born on paper, the modern corporation was designed for one purpose: to relentlessly pursue profit for owners while minimizing their liability for its actions. Ironically, "personal responsibility" moralists seem to be the corporate form's staunchest defenders. That Americans who trumpet family values accept such a model for doing business as if it were divinely inspired is a testament to the seductive effectiveness of the design, the same design that brought world financial markets to the brink of collapse just last year.

Now, Americans who witnessed Washington’s bailout of Wall Street have seen just how much the creation has become the master. The regulatory capture of the government is nearly complete. Standing before the U.S. Capitol in the trailer for Michael Moore’s Capitalism: A Love Story, Ohio Democrat Rep. Marcy Kaptur admits, “The people here really aren't in charge. Wall Street is in charge.”

Congressional Oversight Panel Chair Elizabeth Warren writes, “Families understand with crystalline clarity that the rules they have played by are not the same rules that govern Wall Street. They understand that no American family is 'too big to fail.' They recognize that business models have shifted and that big banks are pulling out all the stops to squeeze families and boost revenues.” The middle class is getting squeezed even tighter as Wall Street prospers.

Lab rats with electrodes implanted into their pleasure centers will keep pressing a lever that fires the electrode – ignoring food and water – until they die from exhaustion. But the financial bailout taught J.P. Morgan Chase, Goldman Sachs, Citigroup, Bank of America and other firms that they can keep on pressing the levers that produce their profits and bonuses and, if anyone dies from exhaustion, it will be the American middle class. The Washington Post's Dana Milbank satirized Wall Street’s self-serving efforts to keep Washington from passing any serious reforms, “Don't regulate us now because the economy is still suffering from the mess we made because we weren't regulated the last time. Chutzpah, it appears, is recession-proof.”

The mortgage crisis tied to the derivatives market set into high relief the tension between the values with which most Americans were raised and the bottom-line thinking they learn to live by forty or more hours a week. Staying true to oneself is hard enough in the face of intense social and economic pressure to replace those values with corporate ones. Harder still when facing an adversary that practices asymmetrical warfare. Perhaps the clearest evidence of that is a recent article by University of Arizona law school professor, Brent T. White.

In Underwater and Not Walking Away: Shame, Fear and the Social Management of the Housing Crisis, White wonders why more homeowners are not walking away from mortgages where they owe more than their homes are worth. The numbers say they should. So why don’t they?

Homeowners are operating on an emotional level, White suggests, weighing their financial interests against issues of guilt and self-respect:

... fear, shame, and guilt are not mere “transaction costs” that homeowners calculate according to their own personal tolerance for each. Rather, these emotional constraints are actively cultivated by the government, the financial industry, and other social control agents in order to induce individual homeowners to act in ways that are against their own self interest, but which are - wrongly this article contends - argued to be socially beneficial.

Consciously or not, these “control agents” use people's own sense of decency, plus fear, guilt and shame to encourage consumer “conformity to the norm of meeting one’s mortgage obligations as long as one can afford to do so.”

Lenders, White argues, exploit an “asymmetry of norms” to extract as much from homeowners as possible. He writes, “[T]he asymmetry of moral norms for borrowers and market norms for lenders gives lenders an unfair advantage in negotiations related to the enforcement of contractual rights and obligations...” His recommendation for homeowners is to tune out their emotions when making financial decisions, to plan carefully, and then to walk away from their mortgages when continuing to pay makes no financial sense. The market bust is "a market failure – not a moral failure on the part of American homeowners."

Kenneth Harvey summarizes White’s argument in the Los Angeles Times, “Don't feel guilty about it. Don't think you're doing something morally wrong.” Put another way, stop thinking like a moral actor. Stop thinking as you were taught at home and at church. Compartmentalize. Think bottom line, like a corporation. And if it makes financial sense, screw your creditors. It's nothing personal.

There may be no other good option. That solution has a certain emotional appeal. Rough justice. Stick it to The Man. Fight fire with fire. But fighting an amoral adversary by adopting his values or surrendering one's own, for human beings, at least, carries risks corporate actuaries cannot calculate in a spreadsheet. (The abyss gazes also into you, as Nietsczhe observed.) Giving in to that cold-blooded logic, even if "financially prudent," feels like surrender, and perhaps the final triumph of corporate thinking.

Views expressed on this page are those of the authors and not necessarily those of Campaign for America's Future or Institute for America's Future