[Overpaid Slacker]

tabs -
Your characterizations are good, but they don't capture (as their proponents apparently don't understand) the larger, macroeconomic movement.

Take your economies of scale example -- it's not just about producing X more of a product, it's about applying the effort (incl. intellectual capital) where it will produce the most wealth. So, you could put X units of labor into making shoes, or you could put it into cancer research. We've got the capital, infrastructure and intellectual development to put more of our efforts into the "harder" things to do -- like cancer research/aerospace, etc., so that's where the Invisible Hand is going to push them.

The larger macroE issue I'm talking about is the movement of our economy from a relatively-less-sophisticated industrial economy to a relatively-more-sophisticated services/technology economy. There are going to be displacements (as there were when we moved from a predominantly agrarian economy to an industrial economy) -- but the two viewpoints you put forward completely ignore the fact that it's not the corporations mucking with the economy and it's not the government mucking with the economy, it's the economy doing its thing.

Sidebar -- business is in business to be in business; if you're not doing what you can to maximize your profits, you'll be out of business b/c others (domestically or internationally) will do what it takes. And those you employed will be on the dole. Corp's are not welfare agencies established for the betterment of humanity; to claim they've got social obligations above and beyond simply playing by the rules is to fundamentally (and deliberately) mischaracterize the situation.

Aurel -- the news of the more than 112,000 jobs created in the last month hasn't made it across the Hudson? Not that I expect fact to prevent you from repeating your beloved mantra. If the economy is producing wealth "only" for stock holders, then ... buy stocks. Your 401(k) does, your pension does... you can too. Our system rewards risk; and capital-at-risk is essential to wealth.

Perhaps Bush disagreed with O'Neil, or was receiving counsel from others who had different ideas than O'Neil. O'Neil has a great case of CEO-itis; he'd run Alcoa with a strong arm for so long that he got used to dictating terms, and if it wasn't his way, he responded like a spoiled rotten kid. Consider the motives of your sources.

Sarbanes-Oxley and the new NYSE and Nasdaq rules have done and will do a lot for corporate ethics (maybe too much -- not too much ethics, just overreaching in some areas) regardless of how O'Neil would've wanted it done. Perhaps, just perhaps, the fact that he couldn't drive the bus when he'd been used to issuing corporate fatwas has a role in his characterizations. I haven't read the book, and frankly it's not on my list, but how much opposing viewpoint does O'Neil incorporate -- and, to the extent he does, how much of the dissent are strawmen he sets up to knock down? I'm talking about choosing (or perhaps fabricating) the weakest of a bunch of opposing arguments, instead of the strongest, to make him look like a conspired-against champion protagonist.

JP