How we got here...Jack Welch and the End of Stakeholder Capitalisme

[Ike Bana]

Dondi says it's "Obama Offshoring", well that's just bullshit. Here's the whole story of the history of offshoring, and we have Rondald Reagan and Congressional Republicans to thank for it. It's a long read but worth it...

Jack Welch and the End of Stakeholder Capitalism

In standard microeconomics, the costs to workers and communities abandoned by profit-maximizing corporations are termed “externalities” — social costs lying outside the deals struck between corporate managers and investors. But why should these costs not be included in assessing whether the deals are good?

Over the last four decades, these “externalities” have grown so large as to swamp internal efficiencies. Entire regions of the country have been denuded of good jobs. Legions of (mostly) men without college degrees have become stranded. The bottom half of the American workforce has been left with stagnant pay and decreasing job security.

The results: rising rates of drug addiction, family violence, child abuse, deaths of despair, and an increasingly angry working class susceptible to demagogues like Trump.

And this massive move toward ending stakeholder capitalism began during the Reagan Presidency and Republican control of the Congress...

Before Welch became CEO of GE, most GE employees had spent their entire careers with the company, typically at one of its facilities in upstate New York. But between 1981 and 1985, a quarter of these GE workers — 100,000 in all — lost their jobs, earning Welch the moniker “Neutron Jack,” along with the glowing admiration of the business community.