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Informationen zum Autor Lawrence E. Mitchell Klappentext American companies once focused exclusively on providing the best products and services. But today, most corporations are obsessed with maximizing their stock prices, resulting in short-term thinking and the kind of cook-the-books corruption seen in the Enron and WorldCom scandals. How did this happen? In this groundbreaking book, Lawrence E. Mitchell traces the origins of the problem to the first decade of the 20th century, when industrialists and bankers began merging existing companies into huge "combines"-today's giant corporations-so they could profit by manufacturing and selling stock in these new entities. He describes and analyzes the legal changes that made this possible, the federal regulatory efforts that missed the significance of this transforming development, and the changes in American society and culture that led more and more Americans to enter the market, turning from relatively safe bonds to riskier common stock in the hopes of becoming rich. Financiers and the corporations they controlled encouraged this trend, but as stock ownership expanded and businesses were increasingly forced to cater to stockholders' "get rich quick" expectations, a subtle but revolutionary shift in the nature of the American economy occurred: finance no longer served industry; instead, industry began to serve finance.The Speculation Economy analyzes the history behind the opening of this economic Pandora's box, the root cause of so many modern acts of corporate malfeasance. Leseprobe THE PRINCIPLE OF COOPERATION 8 The creation of the giant modern American corporation was not a slowly evolving process. Individual proprietorships, partnerships and corporations gradually grew in size and number throughout the Industrial Revolution of the nineteenth century. But what we have come to know as the modern American corporation, the giant, publicly held corporation, appeared in a flash. America collectively turned around one day and was staring at the balance sheet of U.S. Steel.1 THE GIANT MODERN CORPORATION The large corporation was already in late adolescence by the time of the great Chicago World’s Columbian Exposition of 1893, that wonderfully quirky celebration of technological achievement and cultural progress that raised the curtain on a devastating four-year depression. The fruits of industrialization on display there had grown from saplings planted many decades before, produced by the large businesses dotting the landscape from Boston to Baltimore, from Pittsburgh to St. Louis and beyond. They had arrived by means of one of the greatest engines of the American economy, the railroads, whose tracks sprawled across the continent, north and south, east and west. The industrialization that had begun at the turn of the nineteenth century had been kicked into high gear by the insatiable material demands of the Civil War and gave birth to factories from which flowed steel, farm machinery, packaged meat, beer, wheat flour and sewing machines; mines that brought forth copper enough to wire the country for newly generated electricity; oil refineries that lighted homes from California to Europe; great dry goods empires and the Sears Roebuck catalogue. Left to themselves, these remarkable businesses might well have grown, financed with debt and their own retained earnings, created new products and services and supplied America’s wants and needs for evermore. But the large corporations of the nineteenth century were soon to become the raw materials of a new kind of business, a business created for finance rather than for production.29 The businesses of the industrializing nineteenth century were, more often than not, organized as partnerships or closely held corporations. The stock of these enterprises was owned by the founders and their families or a small group of friends and business associates. Standar...
