Capitalism And Manager's Capitalism

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2. (800 Words for Question Two) John Bogle, in his article Democracy in corporate America, defines capitalism in two different ways, owner’s capitalism and manager’s capitalism. According to Bogle, owner’s capitalism is defined with the idea that purpose of a business or corporation is to make a profit. Manager’s capitalism, Bogle notes, is defined by William Pfaff with the idea that “the corporation came to be run to profit its managers, in complicity if not conspiracy with accountants and the managers of other corporations” (Bogle, p. 26). These two definitions of owner’s capitalism and manager’s capitalism provide great insight about today’s corporate America. The two previous descriptions that John Bogle provides of owners and managers capitalism show us the true difference between the traditional idea of capitalism, and the more modern idea, as William Pfaff describes. In order for the differentiation to be clear, we must understand what Bogle is saying in his descriptions of the two types of capitalism. First, owner’s capitalism says that the owner(s) of the company have one basic goal, and that is to make a profit, benefiting the owners in a way so to make a return on their investment into the company. So if the idea of capitalism is to make a profit for the company as a whole, then what is manager’s capitalism, and how did it originate? Bogle describes a situation that can commonly seen in corporate America, which describes manager’s capitalism perfectly.
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