The Politics of Profit

One of the long-held articles of conventional wisdom that needs to be put to rest once and for all is the notion that U.S. corporations are politically conservative. Corporations have no core political beliefs. They care about one thing and one thing only: profits. Not that there's anything wrong with that. It's just the way things are and personally, I wouldn't want it any other way.

I think people have fallen for the "corporations being conservative" line because, over the years, conservatives and corporations have come down on the same side of a number of issues such as taxes, government regulation, and, especially of late, free trade. But while conservatives embrace lower taxes, less government regulation, and more free trade because they fundamentally believe in these positions, corporations support them solely because they believe it will help their bottom line. And only THEIR bottom line. Not their industries bottom line and certainly not in the bottom line of their competitors. In fact, corporations will often call for more government regulation and less free trade if they feel it will help their competitive position.

We can see the latest example in a story from yesterday's Wall Street Journal (sorry, subscription required) on the good start for big business in Bush's second term:

These are good times for business in Washington. President Bush's first term was a mixed bag for his corporate constituents. They got the tax cuts they wanted and some easing of environmental regulations, but also a massive increase in securities regulation and a war that threatened to undermine the appeal of American brands abroad.

Term two is turning out to be very different. The Indian agreement is just one of a long list of pro-business actions that got significantly longer last week. Congress passed a Central American Free Trade Agreement eagerly sought by business, as well as an energy bill and a transportation bill that had been stalled for years. Add to those the new bankruptcy law and the changes in class-action lawsuit rules approved this year, and you have got what the lobbying group Business Roundtable's John Castellani calls an "unprecedented string of accomplishments to help drive the America economy."

With the exception of the energy and transportation bills (especially the transporktation bill), the aforementioned actions should be pleasing to most conservatives. But look what's looming on the horizon:

If anyone thinks this business push for government activism is a temporary phenomenon, well, think again. The elephant in this smoke-filled room is health care.

Health care has become a migraine-intensity cost headache for any company that acts responsibly toward its workers. In the coming years, you can bet that the fiercest lobbying for change won't come from labor or liberal social groups, which have been pushing health-care reform for three decades. It will come from the companies -- and perhaps state governors -- that are footing the bills.

There still are plenty in business who give lip service to the notion that the government that governs least, governs best. But their actions belie their words. The business plans of big business today increasingly involve government.

More government, less cost for business (at least in the short term), and higher profits. The bidness of bidness is indeed bidness.