
Alec Ross
Alec Ross maps the unraveling social contract of the 21st century and charts a path toward a more equitable, sustainable future.
The concept of shareholder primacy was popularized by economist Milton Friedman in 1962.
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Section 1
7 Sections
As we embark on this journey through the turbulent landscape of the 2020s, it is essential to understand the forces that have shaped our modern economy and society. One of the most profound shifts in recent decades has been the rise of shareholder capitalism—a doctrine that transformed corporations into entities primarily focused on maximizing profits for their shareholders. This idea, crystallized by an influential economist in the early 1960s, became the guiding principle for businesses worldwide, especially from the 1980s onward.
Consider the insulin market, where a drug that once cost a mere three Canadian dollars to patent has become a life-or-death expense for many, with prices soaring into the hundreds of dollars monthly. This is a stark illustration of how shareholder primacy can distort priorities, placing profits well above human welfare.
The consequences ripple through communities too. Family farms, once the backbone of rural America, have been swallowed by corporate agriculture. Jobs have fled small towns as headquarters relocate to tax-friendly cities, leaving behind economic deserts. The average American’s wage has stagnated even as corporate profits and executive compensation have soared. This concentration of wealth and power in a few hands is unprecedented since the Great Depression, with the top 50 companies now generating a third of the U.S. GDP.
Let us now turn our attention from the private sector’s rise to the parallel decline in government power and effectiveness, a story that intertwines deeply with the challenges we face today.
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Unveiling the hidden costs of shareholder primacy and the urgent need for a new economic paradigm
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