<b>Pushing for profits</font></b> <i>Our economicsuccess depends on corporations making money</i>

Terre Haute Journal of Business ^ | June 1, 2004 | Robert L. Flott

[Military family member]

Despite a friend's comment that I am the most high-strung person she has ever known, I like to think of myself as fairly laid back.
     Granted, everything is relative.
     Current public sentiment, however, has me boiling over.
     While perusing message boards on the web recently, I have been amazed at the current uproar against "corporate greed."
     While comments range from specific complaints to absurd accusations, the common theme seems to be this: "corporations are only out to make a profit."
     What truly angers me about this concept is that "profit" is seen as a negative pursuit.
     What is so wrong about making a profit?
     Essentially, corporations are tools for ownership. Not all businesses are corporations; there are many other types of business structures, such as:

• Sole Proprietorships (a single, unincorporated owner);

• Partnerships (two or more owners);

• Limited Liability Corporations (usually more than one owner);

• Sub S. Corporations (usually more than one owner);

• Sub C. Corporations (usually more than one owner); and 

• Professional forms (usually more than one owner).

     This is all pretty basic stuff. The purpose for each of the structures is usually to spread the liability of running the business, and to take advantage of certain tax breaks. While some corporations can be incredibly complex, ultimately, that is all corporations are (my apologies to any accountants, business lawyers, or business teachers out there).
     Now, before anyone yells and screams about my naivete, yes, I understand that people are talking about the pursuit of profit over everything else.
     I get that.
     What I don't get is the underlying message that:

A.  All corporations are huge powerful entities with control over every aspect of the lives of the citizens of the United States
B.  All corporations are inherently corrupt.
C.  Everyone works for a large corporation.

     As president and chief executive officer of a corporation-albeit a small one-I take great offense at that.
     Let's examine these myths.
     I called William Dennis, senior research fellow with the National Federation of Independent Businesses, who provided me with the following statistics. I augmented these with numbers from the Bureau of Labor Statistics.
     As of the first quarter of 2004, there were 7,781,420 million businesses operating in the United States. As of April, approximately 130 million people were employed. Table 1 shows how these numbers break down by percentages for both the United States and Indiana.

     Any business with fewer than 500 employees is technically classified as a small business. Thus, small business employs 81.83 percent of the total U.S. work force (80.52 percent in Indiana). That destroys Myth C.
     Small businesses also account for 99.79 percent of all businesses (99.24 percent in Indiana). That destroys Myth A.
     This leaves us with Myth B, which deals with corruption, hence (ultimately) corporate greed. 
Again, I believe that myth is essentially destroyed as well. If we place the number of corporations that have been accused of corruption and other wrong-doings as high as 500, that still only accounts for 0.000064 percent of all businesses.
     Are some corporations corrupt? Certainly! Corporations are made up of people and people are corrupt.
     Are some corporations greedy? Again, certainly, for the same reason.
     Should corporations focus on profit? Of course, they should. One only has to look at the fall of Communist-block countries to see what happens when companies are not allowed to earn a profit.
     Let's not forget that, before a business makes a profit, it has to cover its expenses. When that doesn't happen, the business suffers-and not only that one, but the businesses that serve as its vendors suffer as well. 
     The pursuit of profit is what keeps our economy running. We want our corporations and other businesses to make a profit. I know I want my little corporation to make a profit.
     There are corporations and businesses that do put the pursuit of profit above the welfare of their employees, the environment, and their communities. But those businesses usually don't stay in business very long. 
     I can say with utter certainty that most business owners are honest people, working hard to feed, house  and clothe themselves and their family members-and, often, doing the same for a few other people as well.
     Why utter certainty?
     To do otherwise means a loss of profit.

[MHGinTN]

How can this be?... The democrat party swears that raising taxes higher and higher is the road to prosperity.

[nothingnew]

"corporations are only out to make a profit."

What a concept.

FMCDH(BITS)

[facedown]

Good article! Few people realize the extent of small businesses. I read somewhere that there are about 10,000 publically traded corporations and about 10,000,000 private businesses.

[Military family member]

I'm noy sure what the breakdown is. I know that there aren't a lot of public companies