The Business of Politics

In the States this week it has been all about politics.

The Democrats have just had their Super Tuesday vote, deciding who will be the party’s contender for this year’s presidential election against the Republican incumbent President Donald Trump.

Business always needs to keep an eye on the political situation. That much we know. From Wall Street to Silicon Valley, from Aspen to Austin, Coast-to-Coast you need to understand the political culture of America as much as its business culture that is if you hope to succeed there.

Over the past decades in the US, I’ve noticed a shift in some of these perspectives. The culture of the American business elite – Google, Netflix, Amazon etc. –have all moved to the liberal side of American politics. Once these successful and very wealthy business folk would have automatically been identified by the public as “conservative”, but that is not so any more.

If there is a progressive bandwagon, then you can bet big corporations tend to be or very much want to be getting on board it. You can speculate as to why this is so. Could it be that it is just a clever form of PR? Wanting to stay part of the liberal leaning news and media agenda that rules our lives? Or perhaps the people at the top of these multi-nationals have changed and are just more liberal than generations gone before?

All of this and some of it, or none of it, may or may not be true.

What is incontestable, however, is that the 2020 Democratic primary field of candidates has had two technology billionaires, a millionaire entrepreneur, and a whole host of rich lawyers vying to represent the ordinary people of America and lead them in a liberal direction. Furthermore, if you were to look at the list of the successful entrepreneurs of our time – perhaps all time – that is the Bezos, Gates, Buffett, Zuckerberg, Bloomberg – it is fair to say that that list does not contain many Republican supporters.

This shift of Corporate America to the left is especially pronounced, and perhaps driven by, the rise of Silicon Valley. America’s newer corporate giants are mostly technology firms: Alphabet, Amazon, Facebook, Microsoft, Dell, etc. and all of these are identifying with, if not wholly supportive of, the Democratic political establishment.

So the politics of Big Business has changed and that is because business has changed and is changing. In any event, Wall Street was never politically agnostic. There has always been more to its politics than simply money. That remains the case today.

When the American Republic was established George Washington was said to be the wealthiest man in the Colonies. He was a farmer. Back then agriculture and its produce touched all areas of economic activity. Later in the nation’s history fortunes would be made in commodities and land speculation, but many of these these entrepreneurs still had backgrounds in farming and ranching. For example, those who made fortunes in timber did so after having worked with an axe for years preceding that.

That early – and successful – entrepreneurial culture of homesteading frontier society was individualistic in its assumptions and its mythologies. This was based largely on a mix of such factors as Non-Conformist Christianity and the fact that most early settlers in America had fled various forms of autocracy in Europe, mostly of a monarchical variety. In short, these people didn’t like being told what to think or do by people in authority. They had talents that in the Old World were not recognised or could not be expressed. They found a welcome both politically and economically in the New World and, thereafter, helped build a society from those gifts.

Ironically, that individualism of thought was to breed a kind of business monarchy that being a business model based upon hierarchy. So we had the creation of the Ford Motor Company by one man, Henry Ford; or Procter & Gamble being the creation of two men, J. P. Morgan and John D. Rockefeller. All these men did business in their own way, and in so doing created fortunes along the way, mostly for themselves and their heirs.

This connection between single endeavour and success remains strong in the American psyche to this day. It also remains part of the mind-set of those who wish to enter into the American markets and trade there.

This era of early American capitalism, roughly the end of the 19th and start of the 20th centuries, gave rise to the concept of businessman as hero. Of course part of that was merely mythmaking, deliberately so in some cases by the large corporation’s marketing departments. But, be that as it may, the culture formed by that earlier age of American business identified success with virtue, holding that success in business was somehow to be associated with right morals, such things as sobriety, thrift, perseverance, industry, and other virtues.

Still today the wealthiest people in a society tend to be entrepreneurs. You do not become a billionaire working on a salary for someone else. Entrepreneurs create wealth; they do not sit around waiting for the wealthy to hand some of it their way. Through their wealth entrepreneurs create business empires. It is through these empires that their personal views, be they political or philosophical, are transmitted down the line to their associates and employees.

So the frontier may be now long since closed, and modern entrepreneurship may be a very different animal from that which preceded it but this method of forming a political culture through a business culture remains as true today as it did back when the frontier was open. By extension, the widespread predominance of salaried employment in large organizations, displacing sole-proprietorships and more widespread entrepreneurial employment, changes the culture and the attitudes toward property and business management throughout society. A world of employees is different from a world of farmers, traders, merchants, and shopkeepers. We shall know soon enough what difference this all makes when it comes to who wins the keys to the White House this November.