The Ambiguity of Business

In Atlas Shrugged, Rand clearly distinguishes between real business people and those who simply got the title because they are located in a business. What makes this distinction really difficult is that there is not a pithy name for the latter.

Real business people engage in production, trade, and competition. Those riding on the coat tails of business want to avoid competition. They do produce something, but it is clearly not like real business. In Atlas Shrugged Paul Larken and Mr. Mowen produce. The kicker is not that they do it in a mediocre fashion, but in their reasoning about the whole process. Rand is merciless with the Board of Taggart Transcontinental because they spend their efforts on anything but production.

The reason I point this out is many accuse Rand and Radical Capitalism of being pro-business and then cite the worst of the lot as evidence that such a theory is ludicrous. Not everyone who is called a "business" person really is. That's her point. There is a difference between extant businesses and the practice of business. For instance, recently Fed Ex and UPS were engaged in a political battle over the laws of unionization - each trying to get laws passed that hurt the other. They are businesses, they are engaged in business, but this mutual predation through the political process is not business. (Note they are not simply trying to protect their own - they are trying to hurt the other as well)

An equal mistake would be to say that everything a man parent did in the home was fathering. This is palpably false. Yet, people are willing to believe that everything that is done within the firm is business.

To understand Radical Capitalism is, I believe, to understand the difference between real and fake business.

The Hostage "Business"

This one from a colleague and friend of mine Stephen Hicks, Professor of Philosophy and Executive Director, The Center for Ethics and Entrepreneurship.

His submission is:

The Hostage Business

http://www.nytimes.com/2009/12/06/magazine/06kidnapping-t.html?_r=2&scp=1&sq=adiele+nwaeze&st=nyt


And I thought no one was listening :)

Business and Non-Business

Recently I put forward an assignment to my students. The assignment is as follows:

"Find a written piece that equates unethical activity with business as usual. It is quite common for commentators of various stripes to confuse activity that is not business with activity that is, I want examples of this confusion. The general writing of such pieces is like this: “In a case of business as usual, the XYZ corporation knowingly sold exploding mayonnaise to unsuspecting elderly gnomes. In this classic case of greed/profits before humanity 47 people were hurt, and countless cans of tuna destroyed, in what can only be described as a case of the market run amok.” In this imaginary case XYZ has engaged in fraud, which is stealing, which is not trading, which is thus not business – but the article calls it business. You need not include any explanation with your submission, unless you think it needs explaining. Try not to worry, if a submission is not “what I am looking for” you can try again until you do. I would prefer a newspaper or magazine article, but an example from a book works as well. Blogs are tricky, but regular, well established blogs, stand a good chance of counting. It does not need to be a current event. Any time period is fine. I will post these submissions for all to see on the blog."

I cannot say that I agree with all of the submissions, but that was never the point. The point is to show that there is room for debate on the concept of business and to show this possibility by pointing out instances where, in your informed opinion, you think the source has mistaken business and some other form of activity.

Here are the first examples: (Comments in square brackets are an extremely brief summary of the "beef" the submitter had with the article.)

Loudon man sentenced in bond fraud case
TULSA, Okla. - A Tennessee man has been sentenced to federal prison for his role in an international conspiracy involving 19th-century railroad bonds and 100-year-old Chinese bonds.
Robert William Searles of Loudon was handed a four-year, nine-month prison term and ordered to pay more than $3.6 million in restitution.
The 71-year-old Searles is the third person sentenced in the scheme that federal prosecutors say defrauded hundreds of investors around the world of millions of dollars.

[This is not business…it is stealing]
http://www.nytimes.com/2009/11/02/business/media/02carr.html

The Media Equation
Business Is a Beat Deflated
By DAVID CARR
Published: November 1, 2009

….There are exceptions. Google. Apple. Twitter (assuming it ever makes money). But the editorial tropes of financial might don’t easily describe the nature of their accomplishment. How hot and bothered is a reader supposed to get about an algorithm? And no one wants to read a magazine about the sovereign funds, foreign investors and bargain hunters from afar who seem to be the real power in buying in at the bottom.

[Business is more than just making money…Twitter is a business.]
http://www.timesonline.co.uk/tol/news/uk/crime/article6922184.ece

November 19, 2009
Rabbi Baruch Chalomish accused of swapping cocaine for sexual favours
A rabbi set up in business as a drug dealer and lavished his supplies of cocaine on young prostitutes at parties, a jury was told yesterday.
Rabbi Baruch Chalomish, 54, bearded and wearing a trilby hat, shared the dock at Manchester Crown Court with an interpreter who occasionally translated the barristers’ words into Hebrew.

He was said by the prosecution to be a wealthy man who took up with Nasir Abbas, also 54, a convicted dealer, who had the “knowhow” and the contacts in the drug trade. The rabbi was the financier in the operation. They set up their “commercial cocaine-supply operation” in an hotel service flat in Shudehill, Manchester, where, it is alleged, Chalomish liked to dispense the drug in return for “sexual favours…

[Business is partly defined by trade but not illegal trading especially with the most likely unwillingly.]

Tobacco and Business

http://www.philipmorrisinternational.com/PMINTL/pages/eng/busenv/Bus_environment.asp

[What to do when your business is unhealthy and unpopular? Do fatty meat producers need to do these same contortions?]