Our CEO’s, Their Foreign Agents

Pundits and electioneers like to play up the notion that American-born industries have some great allegiance to the United States, and that de-regulating their actions will yield more jobs and greater economic gains for the whole country. Those that believe this are holding on to antiquated nostalgia that no longer has any real basis in reality. The simple observable fact is that business is predicated on self-preservation and growth, unbounded by borders, allegiances, or ideologies. Furthermore, the notion that democracy is somehow critical to successful economics is not born out by the actions of most corporate entities. What’s important is a diversity of ideologies and socioeconomic conditions that can be leveraged against one another in order to produce needs and market opportunities.

The American Prospect has an illuminating article highlighting how the drive to profit often undermines the goals of both the U.S. and democracy itself. What makes this particular research interesting is that it documents many of the cases where CEO’s have brokered deals directly with authoritarian regimes at the expense of our own founding laws and ideals, both building up our global competitors while undermining our domestic interests.

From Our CEOs, Their Foreign Agents:

The CEOs of global companies often prefer to do business with authoritarian regimes; they can get faster decisions than they can in democracies. But these CEOs also find that they must be more responsive to the desires of the authoritarian regimes than to those of the democracies. Where there are conflicting national interests, the global CEOs are likely to line up on the side of the authoritarians and even to become lobbyists for them within the democracies.

The key problem is the asymmetry of governmental power over corporations in democratic and authoritarian regimes. In Washington, a CEO of a major corporation is an important political player who makes big PAC donations, maintains legions of lawyers and lobbyists, files lawsuits against the government, writes legislation, and influences regulatory decisions. In Beijing, Riyadh, or Moscow, however, the same CEO is a supplicant. He doesn’t file lawsuits against these governments; indeed, he needs to maintain favor and keep the bureaucrats and party operatives happy.

Moreover, he will use his influence in Washington to do what is necessary to curry favor in authoritarian capitals. This is why the Business Round Table and U.S. Chamber of Commerce have been telling the Congress not to worry about China’s currency-management policies that put U.S.-based producers at a disadvantage. Many in the global business community have effectively become lobbyists for the autocrats.