Barbara Ehrenreich The Power Of Negative Thinking Summary

In the corporate setting, capitalism plays an important role in the sense that it helps ensure that the decisions made by leaders, such as the CEOs, take into consideration the company’s or stockholders’ interest in gaining profit (Peñaloza & Barnhart, 2011). This implies that it compels business leaders to make decisions that minimize loses while increasing the profitability of the firm. In most occasions, this is accomplished through the application of the utilitarian and Kantian approach to decision-making. However, it’s important to note that the central implication of public capitalism is that of helping foster corporate decision-making based on the broader effort to promote the public good (Peñaloza & Barnhart, 2011).

Of course, the board does not confess to satisfying the greed for higher profits by taking these unpopular steps; they present all the process as catching up on the competitors. “GM has to do what it has to do in order to stay competitive, even if it means laying off thousands of people”, says a member of the board, and thus makes it more than clear that in a capitalist society the managers and the directors are concerned only with the profit maximization and with their own welfare, whereas the employees have to fight for their jobs in more and more unfavorable conditions. More than 30 000 workers have now lost their jobs, whereas the company’s chairman Roger Smith has just made $2 millions himself. The unions are no help at all in this moment. Supposed to increase the workers’ bargaining power, the unions have now become useless, since “too many people in the unions friends with the management”, whose interests, in this case, are completely the opposites to those of the workers.

The economic nature of private corporations is to be profit-seeking agents whose sole focus is to maximize shareholder value. This is a fair reason and a reason that will always exist. Detractors of privatization and free market systems, argue that

Nowadays, after the passing of several bills constraining the actions of corporations, acting in a similar manner would pose several legal and ethical issues. This is why, Freeman argues, this ancient idea of managerial capitalism is no longer effective.

This situation can lead to negative consequences for a business when its executives or management direct the organization to act in the best interest of themselves instead of the best interest of its owners or shareholders. Stockholders of the enterprise can keep this problem from arises by attempting to align the interest of management with that of themselves. This normally occurs through incentive pay, stock compensation, or other similar incentive packages that now cause the managers financial success to be tied to that of the company (Garcia, Rodriguez-Sanchez, & Fdez-Valdivia, 2015; Cui, Zhao, & Tang, 2007; Bruhl, 2003; Carols & Nicholas,

In this world there are many obstacles that people have to deal with and money related situations could be one of those. An abundance of people struggle to get to the top with the middle or high class, but why is that? The answer to this lies within our society because society it the root of all the problems.

It is hope, he writes, that brought settlers to North America, that helped the first people avoid freezing in the Ice Age, and helped some survive the Holocaust. In history, Watkins emphasizes, one finds stories of people continuously succeeding in the face of hardship, stories that can help one maintain an optimistic mindset. Hope and optimism, once learned, can be as the essay suggests, “a shield against fate and it’s consequences” and the fuel one needs to keep going into the future, with the belief that everything will turn out

People often question whether corporate boards matter because their day-today impact is difficult to observe. But, when things go wrong, they can become the center of attention. Certainly this was true of the Enron, Worldcom, and Parmalat scandals. The directors of Enron and Worldcom, in particular, were held liable for the fraud that occurred: Enron directors had to pay $168 million to investor plaintiffs, of which $13 million was out of pocket (not covered by insurance); and Worldcom directors had to pay $36 million, of which $18 million was out of pocket. As a consequence of these scandals and ongoing concerns about corporate governance, boards have been at the center of the policy

While both of the trials were occurring Morgan and his fiance explained the things they saw and how others that have lived in poverty longer than they felt. The couple also shared how they felt and how they lived, but they really focused on what others felt around them, they even befriend some of the people that they met. Barbara Ehrenreich on the other hand focused on herself and how she was handling everything. She really was not concerned with how the people around felt, their opinions she just wanted the reader to know what she was going through. Even with the differences between the trails they both have one common goal to raise the minimum wage.

CEO incentives make it so that it is their main job to help the stock price rise. By doing this, they increase the value of the company. When the value of the company increases, stocks go up, and wealthy people who own the stocks reap the benefits. Corporate leaders align their interests with the immediate interest of stockholders. This allows CEOs to cut wages as this betters the price and profit of stockholders. Financial strip-mining cut out millions of well-paid jobs and lowered the wages of average workers. Unregulated Wall Street has ruined the American economy for

To the extent of prevention of corporate failure, I argue that three ASX principles and recommendations could halt the demise of Dick Smith. Firstly, the 2nd principle which is “Structure the board to add value” by structuring the board with a majority of independent directors would prevent CEO dominance because some suggest that independent outside directors can reduce the influence of dominant individuals (ASX, 2014, p. 17). In accordance with Gallagher and Bennie (2015, p. 20), the independent directors are likely to focus on the company’s objectives and not to make decision relying on others. Furthermore, an addressing of independent directors would reduce the reliance on management, and create the effectiveness on monitoring (Dechow et al. 1996 cited in Christensen, Kent, and Stewart (2010)), as well as capability to lessen the conflict of interest between managers and shareholders (Hardjo & Alireza, 2012, p. 4). Thus, DSE’s board would be more active to monitor the CEO’s performances because independent directors pay attentions to the interest of company (Gallagher & Bennie, 2015, p. 20) and shareholders (Hardjo & Alireza, 2012, p. 4)

We have a tendency to block out the things that we do not agree with in the world. As the years pass, our society has drastically molded into a primarily selfish, disappointing species of humans that does little more than promote slander and hatred towards one another. Nevertheless, we are not hopeless. There remain millions of individuals who seek out the favorable facets in the world and strive to not only nourish themselves, but to nourish the world around them. Although Barbara Ehrenreich believes that television inaccurately portrays the day-to-day lives that Americans live, the reality is that there are devastating truths behind the brainwashing images that plague our minds.

This was a very interesting article, in my opinion it brings to mind the derived phrase, which came first the chicken or the egg. Meaning, is corporate governance an attempt to control the results of unethical practices of corporations or is it meant to deter them. In reading this article, it is clear that certain corporations practiced unethical business behaviors for self-interest, but the questions this author have are: 1. Should corporate governance be regulated by the legislature as well as the organization and to what degree, 2. Is corporate governance, there to protect the shareholder or the stakeholder, 3. How effective is corporate governance on a global level. The need for a governance system is based on the assumption that the separation between the owners of a company and its management provides self-interest executives the opportunity to take actions that benefit themselves, with the cost of these actions borne by the owners (Larcker & Tayan, 2008).

The rise and fall of the Royal Bank of Scotland is characterized by poor corporate governance which allowed for the complete dominance of the executive management over the board of directors and a massive principal-agent problem. Positive social dynamics and the power of weak ties allowed for compliance while intimidation and bullying tactics silenced questions, concerns and opposition. The board’s utter compliancy and borderline negligence enabled rampant, unchecked empire-building at the cost of shareholder value and led to a spiral of unaccountability and gross incompetence. Stakeholders’ loss of confidence from misinformation and misdirection was an inevitability that sealed

Nevertheless if companies operate in weak markets and fail to create growth and profit the concept of maximization of shareholder wealth is also an opportunity for self-regulation and security against threats for a company. This approach is in particular useful for safeguarding against difficulties arising from wrong or misguided leadership within a corporation. Shareholders of a company have the strongest interest in a company’s success because they often invest a lot of capital in the business and require revenues for their deposit (Moore, 2002). As a matter of fact, they become more