“Our current set of CEOs seem to be OK with government encroachment, and are even helping to participate in it.”
In the 1950’s, when Atlas Shrugged was written, the career path to CEO was through sales and marketing or manufacturing. Either career path required measurable accomplishment and actual creation of value for the organization and its customers.
Today the career path to CEO is through finance or legal. These are administrative careers, not value creation. The path to CEO is more a political walk rather than creating products of value to customers, finding customers, or making things more efficiently. In fact many of today’s financial CEO’s destroyed value by offshoring production to contractors, stock buybacks, and failed mergers and divestitures. It is noteworthy the CEO to worker pay ration has increased 1,000 percent since 1950. Financial CEO’s manipulate numbers to pad their wallets. Few create real lasting value for the shareholders or customers.
Look at the destruction of once great companies and industries in the US since 1950. Auto industry, steel industry, consumer electronics, consumer appliances. Retail - Sears, JC Penney, Kmart, and hundreds of other retail companies. Leverage buyouts, private equity takeovers, and mergers have resulted in assets being offshored, cash siphoned off to management and investment banks. Competitive advantages were squandered and innovation stifled.
Ayn Rand, the author of Atlas Shrugged knew CEO’s who made things, created things, and sold things of value. The concept of a CEO stripping assets to buy back stock to drive the stock price and the value of his stock options was inconceivable in 1957.
Great synopsis. I remember when it seemed as if all of the CEOs of airline companies were ex-pilots or astronauts. I worked for an engineering firm that was run for years by an engineer and did quite well. Then they put it in the hands of a financial doofus and the company tanked and got swallowed up.
Very well stated.
The CEOs figured out that government can be very useful in protecting them from competition. Why do you think big companies are in favor of the $15 minimum wage? it’s not because they want to pay their employees more; it’s because they’re big enough to take the hit and their smaller competitors aren’t. So they’ll increase their market share.