I flew from here to there last night. As sometimes happens in Business, I ran into somebody who is in business. We swapped a few observations for a while. After some time, I felt so appalled that I was forced to feign sleep. I think it was over St. Louis.
I should have known I was in some trouble when we were still on the ground in Los Angeles. The chief flight attendant had just announced that turkey wraps were available for $10 each to people in Coach. “Boy,” he said. “Why don’t they just charge an extra $10 for the ticket and give the things away for free?” I didn’t know and told him so. “These guys who run the airlines are so stupid at that kind of little stuff. What makes you think we can trust them to service and fly airplanes with all these people on them?”
This violated the first rule of in-flight discourse: No talk about anything related to airplane malfunctions.
It developed that we had both been in the same business at one point. I asked him what he did now. “I sold my business a little while back for a small fortune,” he said, indulging in the kind of bragging you get used to after a while. Not. “Now I’m an investor.”
“You must be taking it on the chin,” I said, possibly to get back at him for being so forthcoming about all that “small fortune” stuff. He allowed that he had been hurt, but was still investing. We then discussed a variety of issues relating to a number of business sectors. By the time we got over Nebraska, it was clear that this guy knew absolutely nothing. I’m not talking about insight here. I’m talking about events. Facts. Things that are happening. Mergers that took place and rocked the world. Companies that were no longer in business. Guys who had died. I’m not going to go into all of it. It was when he expressed surprise that you could download movies and watch them on your computer that I tuned him out.
Perhaps he’s smart and informed in other things. He seemed up on politics. He did seem knowledgeable about Warren Buffett’s less successful investments. He was reading an intelligent book, I saw, over which he fell asleep two or three times. Perhaps he’s just one of those people who do nothing but watch CNBC and read soft economics and analysts’ reports from firms that are now receiving bailouts. Maybe he knows a lot about cheese futures or something.
A few years ago there was a big debate about “Who owns the corporation” and all the wizards who know nothing at a very high level came to an agreement: It was the shareholders who owned the company. Not the employees who make the product, who work over years to build the value of the operation and live and die by its fate. Not the customers who use the stuff they make. No, it was guys like this one, who have a little bit of the enterprise and can unload it at any time without feeling a pinch.
Look at the paper. This is where that kind of thinking has led us.
At this point I believe that Wall Street and our entire stockholder-centric culture is killing American business. What’s good for investors is not always good for the companies and the workers who have to live in the system, not just feed off it after paying a small price for admission. Is it possible, that at some time in the future, the welfare of the companies we serve could be divorced from the fear, the greed, the feral hysteria of the securities marketplace?