Round-Up on “Giving Back is a Slippery Slope”: Asking the “Right” Question

By Robert Capozzi

First, thank you to Joseph Newhard for finding a Google executive who actually used the term “giving back.” Sandberg’s quote helps to further illustrate my point: Note that she says “…we are interested in giving back to the community.” [emphasis added]

It appears from this statement that Google is not acceding to Newhard’s point, that some feel that corporations have an obligation to “give back” to the community. While my original article dealt with this question fleetingly, the answer is, again, “no.” In no legal sense do corporations “owe” society. Indeed, many corporations are simply not in a position to give charitably, as they are sometimes unprofitable.

Is Sandberg’s quote in some other way endorsing the notions that corporations are ethically obliged to give back? No, certainly not explicitly. It’s simply Google’s choice, not an “obligation.”

Does it in any way imply that Google accepts some people’s view that corporations don’t add value, and are “takers” from society? No, again. Some may hold that view, but here Newhard and I are in total agreement. Corporations, and business enterprise generally, by definition add value, or they fail in the marketplace. Individuals buy products and services because they believe that possessing said product or service enhance the buyer’s life in some way.

Newhard should be commended for reminding us of that obvious fact.

Of course, the rhetoric of charity can sometimes sound guilt ridden. That’s most unfortunate. It might also feed into an “anti-capitalist” mentality. But, to me, the anti-capitalist mentality is far more pronouncedly inflamed by the many dot-com-era frauds that have been unearthed in recent years. The case for free markets was injured by Enron, WorldCom, Tyco, ImClone and even Martha Stewart in the public square, in my opinion.

Google helps the case, even if they use terminology that somehow might “feed” the anti-capitalist mentality.

As to economics vs. business, yes, of course those are different things. My article points out, however, that the economics of corporate philanthropy may well be good business, too. The power of building esprit de corps and tending to psychic costs and benefits in the corporate collective are often overlooked by economists, who generally have no expertise in managing businesses. Brin and Page may recognize that making Google about “something bigger,” something beyond simply their short-term bottom-line is far preferable to the Koslowski-style of business. Philanthropy may simply be helpful to the “corporate soul” on a number of levels. Whether that’s “altruism” seems absurd, given Google’s strong profit margins and lucrative compensation packages.

Having been in Corporate America, I would agree that Koslowski’s approach is clearly not “altruistic.” It worked for Koslowski as he luxuriated behind that $5000 shower curtain, I suppose. I’ve seen that behavior enough to believe it doesn’t generally work in a sustainable way on many more levels of inquiry.

So, is “giving back” poor rhetoric and perhaps in some ways promoting an anti-capitalist mentality? Perhaps. The more insightful question for me is: Is Google’s philanthropy itself anti-capitalism? Absolutely not. Is Google’s style of business preferable to Tyco’s? Hands down, walking away, yes.

Apologies to Newhard. I did reframe the issue to one that I considered more relevant. The rhetoric surrounding corporate philanthropy seems less important to me than the implications of whether free market businesses can, and perhaps should, if possible, engage in such charitable activities.

Robert Capozzi is an Associate Editor for The Free Liberal.