The Common Good

by Robert B. Reich

  I don’t want to suggest it has only been Republicans who have admonished their leaders over whatever-it-takes politics. In October 2015, during the Democrats’ primary debate, Virginia senator Jim Webb was asked how, if he were elected president, he would govern differently from Barack Obama. Webb said the difference would be “the use of executive authority.” Webb said he objected to Obama’s tendency to make laws through executive orders. The practice hurt our system of government. “I came up as a committee counsel in the Congress, used to put dozens of bills through the House floor every year as a committee counsel,” Webb said. “I have very strong feelings about how our federal system works and how we need to lead and energize the congressional process instead of allowing these divisions to continue to paralyze what we’re doing. So I would lead—working with both parties in the Congress and working through them in the traditional way that our Constitution is set.”

  Whatever-it-takes politics comes at a huge cost to the common good. That cost is often hidden. McCain, Flake, and Webb brought some of it into the light.

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  An American president is not just the chief executive of the United States, and the office he (eventually she) holds is not just a bully pulpit to advance certain policy ideas. He is also a moral leader, and the office is a moral pulpit invested with meaning about the common good. It is hardly the case that every president has been a moral exemplar, but a president inevitably helps set the moral tone of the nation. The values a president enunciates and demonstrates ricochet through society, strengthening or undermining the common good.

  As one of George Washington’s biographers, Douglas Southall Freeman, explained, Washington believed he had been entrusted with something of immense intrinsic worth, and that his duty was to uphold it for its own sake and over the long term. Even by June 1775, when Congress appointed him to command the nation’s army, Washington had already “become a moral rallying post, the embodiment of the purpose, the patience, and the determination necessary for the triumph of the revolutionary cause. He had retained the support of Congress and won that of New England in like manner and measure, by directness, by deference, and by manifest dedication to duty.” Washington exemplified a duty to the cause of the Constitution and liberty. He led by moral example.

  Some 240 years later, in the 2016 presidential campaign, candidate Donald Trump was accused of failing to pay his income taxes. His response was, “That makes me smart.” Although not yet president, his comment conveyed a message to millions of other Americans that paying taxes in full is not an obligation of citizenship. As I’ve pointed out, Trump also boasted about giving money to politicians so they would do whatever he wanted. “When they call, I give. And you know what, when I need something from them two years later, three years later, I call them. They are there for me.” In other words, it’s perfectly okay for business leaders to pay off politicians, regardless of the effect on our democracy.

  Trump sent another message by refusing to reveal his tax returns during the campaign or even when he took office, or to put his businesses into a blind trust to avoid conflicts of interest, and by his overt willingness to make money off his presidency by having foreign diplomats stay at his Washington hotel, and promoting his various golf clubs. These were not just ethical lapses. They directly undermined the common good by reducing the public’s trust in the office of the president. As The New York Times editorial board put it in June 2017, “For Mr. Trump and his circle, what matters is not what’s right but what you can get away with. In his White House, if you’re avoiding the appearance of impropriety, you’re not pushing the boundaries hard enough. Government ethics officials say dealing with this administration is an exhausting game of whack-a-mole: go after one potential violation, and two others crop up. That’s because ethical regulations were not written with this sort of administration in mind.”

  A president’s most fundamental responsibility is to uphold and protect our system of government. Trump has weakened that system. When, as a presidential nominee, he said that a particular federal judge shouldn’t be hearing a case against him because the judge’s parents were Mexican, Trump did more than insult a member of the judiciary; he attacked the impartiality of America’s legal system. When Trump threatened to “loosen” federal libel laws so he could sue news organizations that were critical of him and, later, to revoke the licenses of networks critical of him, he wasn’t just bullying the media; he was threatening the freedom and integrity of the press. When, as president, he equated neo-Nazis and Ku Klux Klan members with counter-demonstrators in Charlottesville, Virginia, by blaming “both sides” for the violence, he wasn’t being neutral. He was condoning white supremacists, thereby undermining equal rights. When he pardoned Joe Arpaio, the former sheriff of Maricopa County, Arizona, for a criminal contempt conviction, he wasn’t just signaling it’s okay for the police to engage in brutal violations of civil rights; he was also subverting the rule of law by impairing the judiciary’s power to force public officials to abide by court decisions. When he criticized NFL players for kneeling during the national anthem, he wasn’t just asking that they demonstrate their patriotism; he was disrespecting their—and, indirectly, everyone’s—freedom of speech. In all these ways, Trump undermined core values of our democracy.

  Steve Kerr, coach of the NBA’s Golden State Warriors, responded to Trump’s attack on the NFL players by using Kerr’s own position of authority to reframe what the players were doing. “Just think about what those players are protesting,” said Kerr.

  They’re protesting excessive police violence and racial inequality. Those are really good things to fight against. And they’re doing it in a nonviolent way. Which is everything that Martin Luther King preached, right? A lot of American military members will tell you that the right to free speech is exactly what they fight for. And it’s just really, really upsetting that the leader of our country is calling for these players to be “fired.”

  Kerr went on to urge Trump to use his moral authority as president to unite rather than divide.

  The fact is we live in an amazing country, but it’s a flawed one. I consider myself unbelievably lucky to live here, so please spare me the “If you don’t like it you can get out” argument. I love living here. I love my country. I just think it’s important to recognize that we as a nation are far from perfect, and it’s our responsibility to try to make it better. And one of the ways to do that is to promote awareness and understanding and acceptance. Not just acceptance but embracing our diversity, which when you get down to it is not only who we are but truly what makes us great. And it’s not happening. Remember, the president works for us, not vice versa. We elected him. He doesn’t just work for his constituents and his base. He works for every citizen. Once you take that office, you have to do what’s best for the entire country. Sure, you’re going to have policies that align with your party, but that’s not the point. Respectfully, Mr. Trump, the point is this: You’re the president. You represent all of us. Don’t divide us. Bring us together.

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  The mere fact that someone has become president of the United States itself lends his views public legitimacy. A team of economists led by Leonardo Bursztyn of the University of Chicago showed that Trump’s harangues against immigrants during the 2016 presidential election helped legitimize anti-immigrant bigotry. Two weeks before the election, Bursztyn and his colleagues recruited 458 people from eight states where Trump was leading. Half were told Trump would definitely win; the other half got no information about Trump’s projected victory. The researchers then asked each of them whether they would authorize the researchers to donate $1 to a group called the Federation for American Immigration Reform, which the researchers described (accurately) as an anti-immigrant organization whose founder wants European Americans to remain the majority in the United States. Half were assured their decision would be anonymou
s; the other half assumed it could become public. For those who were not informed about Trump’s expected victory in their state, donating to the anti-immigration group was far more attractive when their anonymity was assured than when they thought they might be exposed (54 percent authorized the donation if secret, 34 percent if it might go public). But among participants who were told Trump would win, half authorized the donation regardless of anonymity.

  While many Americans harbored anti-immigrant feelings before Trump, they kept those feelings to themselves. Perhaps they didn’t even allow them to rise to full consciousness. That’s because such sentiments were assumed to be wrong—to violate the common good. But Trump’s election legitimized those sentiments because it suggested that millions of others shared them. After Trump, bigotry became more acceptable.

  So did bashing political opponents even after an election is over. Before Trump, the peaceful transfer of power was assumed to be a central feature of our democracy. As Harvard political scientist Archon Fung has noted, when losing candidates congratulate winners and deliver gracious concession speeches, they demonstrate their commitment to the democratic system over any specific outcomes they fought to achieve. That demonstration is an important means of reestablishing civility. Think of Al Gore’s gracious concession speech to George W. Bush in 2000, after five weeks of a bitterly contested election and just one day after the Supreme Court ruled 5–4 in favor of Bush: “I say to President-elect Bush that what remains of partisan rancor must now be put aside, and may God bless his stewardship of this country….Neither he nor I anticipated this long and difficult road. Certainly neither of us wanted it to happen. Yet it came, and now it has ended resolved, as it must be resolved, through the honored institutions of our democracy….Now the U.S. Supreme Court has spoken. Let there be no doubt, while I strongly disagree with the court’s decision, I accept it….And tonight, for the sake of our unity as a people and the strength of our democracy, I offer my concession.”

  Bush’s response was no less gracious: “Vice President Gore and I put our hearts and hopes into our campaigns; we both gave it our all. We shared similar emotions. I understand how difficult this moment must be for Vice President Gore and his family. He has a distinguished record of service to our country as a congressman, a senator, and as vice president. This evening I received a gracious call from the vice president. We agreed to meet early next week in Washington and we agreed to do our best to heal our country after this hard-fought contest….Americans share hopes and goals and values far more important than any political disagreements. Republicans want the best for our nation. And so do Democrats. Our votes may differ, but not our hopes.”

  Many voters continued to doubt the legitimacy of Bush’s victory, but there was no civil war. Think of what might have occurred if Gore had bitterly accused Bush of winning fraudulently, and blamed the five Republican appointees on the Supreme Court for siding with Bush for partisan reasons. Think what might have happened if, during his campaign, Bush had promised to put Gore in jail for various improprieties, and then, after he won, accused Gore (or Bill Clinton) of spying on him during the campaign and trying to use the FBI and CIA to bring about his downfall. These statements—close to ones that Donald Trump actually made—might have imperiled the political stability of the nation. They would have sacrificed the common good to an extreme form of whatever-it-takes politics. Instead, Gore and Bush made the same moral choice their predecessors had made at the end of every previous American presidential election, and for the same reason: They understood that the peaceful transition of power confirmed the nation’s commitment to the Constitution, which was far more important than their own losses or wins. It was a matter of public morality. Trump had no such concern.

  This is the essence of Trump’s failure of trusteeship—not that he has chosen one set of policies over another, or has divided rather than united Americans, or even that he has behaved in childish and vindictive ways unbecoming a president. It is that he has sacrificed the processes and institutions of American democracy to achieve his goals. By saying and doing whatever it takes to win, he has abused the trust we place in a president to preserve and protect the nation’s capacity for self-government.

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  CEOs and directors of major corporations are also entrusted with the common good. It is no excuse for them to argue they have no choice but to do whatever it takes to maximize share prices. No law requires them to do this. As I’ve shown, the idea that the sole purpose of a corporation is to maximize share prices is relatively new, dating back to the 1980s. The dominant view for decades before had been that corporations are responsible to all their stakeholders.

  In the summer of 2014, the managers, employees, and customers of a New England chain of supermarkets called Market Basket joined together to oppose the board of directors’ decision earlier that year to oust the chain’s popular chief executive, Arthur T. Demoulas. Their demonstrations and boycotts emptied most of the chain’s seventy stores. What had been special about Arthur T, as he was known, was his approach to business. He kept prices lower than his competitors, paid his employees more, and gave them and his managers more authority to make decisions. Just before he was ousted he offered customers an additional 4 percent discount, arguing they could make better use of the money than the shareholders could. Arthur T viewed Market Basket as a joint enterprise from which everyone should benefit, not just its shareholders—which was why the board fired him. Yet eventually consumers and employees won. The boycott was so costly that the board sold the company to Arthur T.

  CEOs of big corporations might say Market Basket doesn’t apply to them because it’s not a publicly held company whose shares are traded on major stock exchanges. Market Basket doesn’t have to worry about failing to maximize share prices, and thereby succumb to corporate raiders or activist investors. True, but this doesn’t let CEOs of publicly traded companies off the hook. Arthur T’s business model could be applied even where many shareholders are involved. Patagonia, a large apparel manufacturer based in Ventura, California, for example, has organized itself as a “benefit corporation”—a for-profit company whose articles of incorporation require that it take into account the interests of workers, the community, and the environment, as well as shareholders. Benefit corporations are certified and their performance is regularly reviewed by nonprofit third-party entities, such as B Lab. By 2017, thirty-one states had enacted laws allowing companies to incorporate in this way, thereby giving CEOs and directors explicit legal authority to consider the interest of all stakeholders.

  CEOs might still argue that if they want to raise money in public capital markets they have to attend solely to the interests of shareholders, or else competitive forces will wipe them out. That argument makes it sound as if CEOs are powerless to change this. But recall that markets are based on rules, and human beings create those rules. Remember also that CEOs of large companies have outsized political influence over what those rules are. CEOs who understand leadership as trusteeship could use their outsized political influence to push for laws that resurrect stakeholder capitalism—requiring CEOs to consider all their stakeholders; giving workers greater voice in management decisions, as in Germany; requiring companies to make “severance payments” to communities they abandon, in order to compensate for the disruption; prohibiting mandatory arbitration in contracts with customers and employees; and limiting the tax deductibility of CEO pay.

  Why stop there? Why don’t CEOs of big companies do whatever they can to make the economy work for everyone rather than for a privileged few like themselves? Rather than reflexively seek tax cuts, they could push to raise taxes on corporations as well as on people like themselves and other wealthy Americans, and dedicate the funds to better schools for all American kids. They could seek a higher minimum wage, bigger wage subsidies (in the form of the Earned Income Tax Credit), better infrastructure, more portable pensions, universal health care, and
other measures that would raise wages and make American workers more economically secure. Rather than fight for laws that make it harder for workers to unionize, they could fight for laws that make it easier.

  If this sounds far-fetched, that’s only because of how far we’ve come from the era when the heads of American business viewed themselves as “corporate statesmen” with responsibilities for the common good. In the 1940s and 1950s, CEOs of major corporations like General Motors, Coca-Cola, and Eastman Kodak joined together in the Committee for Economic Development, to lobby for measures to expand jobs. They even argued that unions “serve the common good.” In the 1960s, many of these CEOs lobbied for stronger environmental protections, and for passage of the Environmental Protection Act.

  As I’ve noted, most Americans now believe the system is rigged in favor of big corporations and Wall Street, and in many respects it is. But nothing is stopping CEOs and top executives on Wall Street from putting an end to the rigging. They could reduce the needs of candidates to raise vast sums of campaign money by supporting public financing of campaigns. They could back stricter limits on the “revolving door” between industry and government personnel, and laws requiring full disclosure of the sources of all campaign funding. Why shouldn’t CEOs and top Wall Street executives be in the vanguard of seeking a constitutional amendment allowing lawmakers to limit lobbying and campaign spending?