Marc Benioff: We Need a New Capitalism

https://www.nytimes.com/2019/10/14/opinion/benioff-salesforce-capitalism.html

by focal • 7 years ago

71 89 7 years ago

croon• 7 years ago

When government is unable or unwilling to act, business should not wait.

I hope this is all based in good intentions, and have no real reason not to believe so, other than past experience.

I just had this idea though: Seeing the current state of US regulatory capture; I wonder what would happen if companies that felt the way Marc Benioff claims he does (as well as the other companies in that roundtable) would just start paying the same lobby money as business has done previously, but instead ask for sane regulation, aiming for what they claim to be working towards.

If I was a politician beholden to corporate money, but also still had a sliver of a soul left in me, and was given the option of the same money, but to work for the people that elected me, I could actually get some real legislative work done. At least if the same was true for other representatives and senators.

Or campaign finance reform and outlawing outside payment to politicians, but that's a catch 22 given the above.

Aeolun• 7 years ago

At that point you just get paid more to make the wrong decisions again.

Buying the soul of politicians seem to be surprisingly cheap.

BurningFrog2• 7 years ago

If you don't lobby for your selfish interests, you'll get out-regulated by companies who do. Lobbying is not an optional luxury. You have to do it. At least in politically sensitive industries.

As a partially made up example, I'm guessing the plastic straw industry didn't think they had to lay a groundwork lobbying for their existence over the decades. And now they're dead.

jiveturkey4• 7 years ago

I see your point, but bad example. There isn't a plastic straw industry. There is a plastic industry and a restaurant supply industry. There is no single focus on straws ...

And no they are not dead. Get our of your bubble. The places where plastic straws are not allowed is tiny, tiny tiny.

Qworg• 7 years ago

Well, some automakers are trying at least: https://www.gov.ca.gov/2019/07/25/california-and-major-autom...

Miner49er2• 7 years ago

Well, he gave a nice list of problems caused by capitalism, and said we need a new capitalism, but gave no reason why. Why a new capitalism? Why not something different, like market socialism, where the shareholders are the employees?

WilliamEdward4• 7 years ago

I think they either have no concept of another system or are in denial about how problematic capitalism really can be and are blaming the wrong things.

anonuser123456• 7 years ago

What prevents employees from buying shares today?

Miner49er2• 7 years ago

I don't think it's possible. If a company's market cap is low enough that its employees can afford to buy all the shares with their salaries I think that would be a significantly failing business.

akvadrako• 7 years ago

Employees can join worker-owned coops if they want to own the companies they work for. There are a few successful companies like this.

Most employees just don't seem to want that. Maybe because it's more risk.

morvita• 7 years ago

Money? Opportunity?

How many employees (even high earning employees like engineers) are actually in a position to purchase enough shares to make a difference? Even for most "publicly owned" companies the vast majority of shares are held by a small number of investors who aren't giving up their control and power.

WilliamEdward4• 7 years ago

It's unrealistic to hope businesses do the right thing, especially when profit inherently wins out over all else, and it means you cannot do the right thing in your business without losing to the competition who doesn't care.

That's kind of a big issue with capitalism, and any revisionist/reformist take on capitalism has to try really hard to convince me this won't be an issue.

This article misses that point badly. If you're going to criticise capitalism at least try to understand what actually makes it bad.

RcouF1uZ4gsC• 7 years ago

Legislation to close loopholes in the Equal Pay Act have stalled in Congress for years, and today women still only make about 80 cents, on average, for every dollar earned by men. But congressional inaction does not absolve companies from their responsibility. Since learning that we were paying women less than men for equal work at Salesforce, we have spent $10.3 million to ensure equal pay; today we conduct annual audits to ensure that pay remains equal.

If Benioff is going to quote the .80/$1 statistic, then the equal pay audits of SalesForce need to use the same comparison which is to take the average pay of all women in the company regardless of position or job and compare it to the average of all the men in the company regardless of position or job.

If you actually do the comparison taking into account job and position, you get something like .93/$1

https://www.politifact.com/truth-o-meter/statements/2018/apr...

weberc26• 7 years ago

And if you account for other factors, like flexibility and other benefits, you get within the margin of error--women may even out-earn men.

grenoire• 7 years ago

As a rule of thumb, if you would like to not get downvoted for controversial statements, please source your assumptions.

dev_dull2• 7 years ago

This whole discussion is so tired to me. I’d like to see organizations who genuinely want to end inequality to start compensation transparency practices. Let’s see the numbers and we’ll decide for ourselves. After all, it’s not in our interest that salaries are so closely guarded.

Consultant32452• 7 years ago

After all, it’s not in our interest that salaries are so closely guarded.

I think it's in my interest that salaries are closely guarded. Virtually every time in my private life someone has found out how much I make it's been a problem for me.

geebee3• 7 years ago

It does (or at least should) put Benioff in a difficult position, in terms of argument, if he cites his own company's pay gap as evidence of why we need broad societal change, but then refuses to provide the transparency and data that would enable society to evaluate his claim.

If Benioff says "our company did an internal audit, discovered an internal pay gap, and took internal measures to correct it", ok then. But if he says they did an internal audit and on the basis of these results, the rest of us need to change, then he needs to allow us to verify his claim, the way we'd do with any policy argument based on data.

kolbe• 7 years ago

I don't think it's too unfair to read deeper into Marc's motives. Salesforce has never been interested in noble pursuits like making high quality products. They've been interested in creating moats to rent seek off of. They've been interested in promising functionality, then making it too hard for clients to leave once they find out its deficiencies.

To that end, I'm sure Marc wants regulation because he knows that paying lawyers $5m a year to adhere to them is no big problem for Saleforce to pay, but it will sure as hell prevent Paul Graham from being able to seed a new company to disrupt Marc's fortune. And he will quote whatever statistic is necessary to accomplish that goal.

mindfulplay2• 7 years ago

I think given the amount of effort Benioff had put in, I do think he comes from the right place. But just don't have the same level of rigor and mental investment as say Gates.

chrshawkes• 7 years ago

Marc is a grade A showboat asshole. Your comment hits the nail on the head.

jadell7• 7 years ago

So why is average pay for women across all positions less than men? It's not like Salesforce employees are doing heavy manual labor that skews itself towards hiring more men. Why aren't women being hired in positions at the same rates as men (at which point we can then address the issue of pay inequality for the same position?) If this is an issue of "we're not hiring women to the same higher paid positions as men", that is a problem separate from the problem of "we're not paying women equally to men in the same position."

oarabbus_3• 7 years ago

Higher-paying executive and engineering positions tend to skew more male, and lower-paying executive assistant/secretarial/administrative positions tend to skew more female.

There is plenty of overlap but the distribution skew results in men, on the aggregate, being paid slightly more than women.

remarkEon2• 7 years ago

You're supposing that women all want or aspire to the same types of positions that men do, which isn't true.

jimbokun3• 7 years ago

If this is an issue of "we're not hiring women to the same higher paid positions as men", that is a problem separate from the problem of "we're not paying women equally to men in the same position."

Which is exactly the point. The solution may be much farther back in the pipeline, when young people are making educational choices, and can't be solved at the point companies are looking to hire someone.

linuxftw• 7 years ago

heavy manual labor that skews itself towards hiring more men

That's perpetuating a gender stereo type.

"we're not hiring women to the same higher paid positions as men", that is a problem separate from the problem of "we're not paying women equally to men in the same position."

The former is a way to cover the latter. A woman might be employed in a role similar to a man, but the actual title of the position might be different, and thus different pay, even though their job function might be completely identical.

Why aren't women being hired in positions at the same rates as men

Women face exclusion early in their careers (according to many women), so it's hard for them to have any level of experience. Most good paying jobs are mid to senior level, and those jobs are being filled by the endless supply of people that hold "Masters Degrees" from overseas.

jimbokun3• 7 years ago

Regarding the Politifact article, full credit to Senator Tina Smith for immediately correcting her tweet after being informed it was incorrect.

Too many politicians double down when they get something wrong and try to defend it, instead of admitting they made an error.

peterwwillis4• 7 years ago

I think this kind of misses the point. Even if there's only an 8% gap, the question isn't just "what causes the gap". Assume you can rationalize it. Is rationalized inequity OK? Why or why not?

Women aren't the only group this applies to, of course. There's lots of inequity in our society. But I don't think anyone in modern-day times would agree that this is "the way it's supposed to be", as if women are supposed to make less. In the past, philosophers have justified slavery because it seemed to make sense, but now we realize it's immoral. Couldn't the same be true of all kinds of equity gaps in our society?

To reframe it a bit, men are the minority population, yet this pay gap still exists in their favor. If men were the ones making 8% less, I bet there'd be a lot more work to reach pay parity.

Digory• 7 years ago

You can't get rid of "inequity" if inequity reflects different desires and choices by human beings.

Beauty, strength, intelligence, youth and health are wanted by most men and women. But they are not distributed or desired equally. That unequal distribution of desires and characteristics among people will lead to some kinds of inequality.

weberc26• 7 years ago

If the inequity is due to free people freely making different choices, then it is strictly better than coercing people to make the choices <some group> wants them to make. It is eminently desirable that _all_ people are free, even if that freedom doesn't yield some neat behavioral parity. Pressuring women to behave in a certain way is creepy.

kneel• 7 years ago

The extremely wealthy keep talking about how to tackle inequality, many of them pledge to do something about it but nothing ever happens.

We all know how this plays out, we'll get lip service until we start to kill the rich. Then they'll apologize, reform, and do it a little more subtly next time.

dev_dull2• 7 years ago

Killing the rich and seizing their property always turns out well for the everyday joe and never creates a generation of ultra wealthy and corrupt ruling class /s

Wait you didn’t think YOU were going to get that stuff did you?

jadell7• 7 years ago

People who cry loudest for revolution are usually the ones who don't ever study the history of successful revolutions. Especially: who the actual revolutionaries were, what positions they held in society before and after the revolution (hint: most successful revolutions aren't peasant uprisings), and what happens to people who weren't either the revolutionary leaders or the ruling class before, during, and after the revolution. The average French peasant did not fare well during or after the French Revolution.

gnu8• 7 years ago

This is easy for Benioff to say because he's already wealthy. Let's table this until such a time as I become wealthy too. After that we can talk about dismantling capitalism.

WilliamEdward4• 7 years ago

I unironically agree. Either nobody is rich, or we all have the opportunity to get rich. I will not settle for inequality which is what is proposed under the hood by this author.

nicoburns• 7 years ago

He's not wrong. Most ideas for fixing capitalism will lead to fewer grossly wealthy people. Many rich people support this despite the fact that it will make them less wealthy.

mindfulplay2• 7 years ago

He identified the problem being "companies shouldn't wait for government to take action".

Then, he proposed solutions that still seem to involve increasing taxes.

If government is inefficient in allocation of resources and has disincentivizes to actually solve problems in reasonable timelines with reasonable red tape, then perhaps letting private companies take on improving infrastructure or providing care easier might be a good solution.

Look city governments have huge cash chests: neither homelessness nor poverty had ever been addressed by throwing government/money at these problems. You need the right inventives to tackle these challenges. And frankly governments need to reduce the friction in terms of money allocation and regulations to get things done.

mkettn• 7 years ago

You need the right inventives to tackle these challenges. And frankly governments need to reduce the friction in terms of money allocation and regulations to get things done.

Churches did this in the past (with all the bad side effects). But I guess in more secular regions government needs jump in (with all the bad side effects).

jasonlfunk2• 7 years ago

Sure it would be great for business leaders to change their ways, but the beauty of capitalism is that consumers can force businesses to change by their actions. Mark Zuckerberg could change Facebook overnight, but what incentive does he have? It’s still one of the most populous websites in the world.

It’s easy to blame to rich and wealthy for the problems but they cannot force us to give them money. Every time I buy Facebook ads, I’m telling Mark that it’s okay for him to continue what he’s doing.

It’s very fun these days to blame the 1% for societies problems. But the 99% enable them.

bschne2• 7 years ago

If you take a very simplistic model of how the economy works, this is true.

The problem is when you get into a situation/equilibrium where enabling business practices that you consider to be bad for society as a whole is the rational choice because anything else will just leave you out-competed by someone else who doesn't care.

I am not saying that this makes it OK to do whatever because "everyone does" or "if I don't, someone else will", I'm just saying that appealing to individuals to just "do the right thing" has almost never worked to efficiently/swiftly bring about changes like this.

jasonlfunk2• 7 years ago

I'm just saying that appealing to individuals to just "do the right thing" has almost never worked

Which is exactly what Mr. Benioff is trying to do with this article. Companies change when it's in their financial interest to do so; and rarely before then.

clairity• 7 years ago

common folk don’t hate rich people (or the products they offered to get rich), they hate that rich people put a thumb, a palm, an elbow, and a foot on the scales in their favor. no one wants a handout, we want fairness.

virgil_disgr4ce• 7 years ago

the beauty of capitalism is that consumers can force businesses to change by their actions

Wow. That's adorable. Did you just turn 14?

dang• 7 years ago

You've been breaking the site guidelines a lot lately. If you keep doing it, we're going to have to ban you. Would you mind reviewing https://news.ycombinator.com/newsguidelines.html and using the site as intended from now on?

executive• 7 years ago

In conclusion: buy my overpriced Salesforce products because I'm a good billionaire with a private jet.

limeman• 7 years ago

Exactly man. Salesforce is money making machine and overpriced crm.

nrp• 7 years ago

Not to be excessively cynical, but the purpose of this opinion piece probably has more to do with: “Marc Benioff is the chairman and co-chief executive of Salesforce and the author, with Monica Langley, of the forthcoming book, “Trailblazer: The Power of Business as the Greatest Platform for Change.”

TheOtherHobbes• 7 years ago

Not to be even more cynical, but I can't help wondering how the advance and royalties on that book are split between the co-authors vs time spent writing/editing.

jaoued• 7 years ago

Each time I read a billionaire criticizing the current capitalistic system, that reminds me of Jacques Attali's argument on how Karl Marx was misunderstood with Socialism.

https://www.newstatesman.com/node/195490

Extract: "Attali: What he tried with the international socialist movement was an amazing attempt to think about the world in global terms. Marx is an amazingly modern thinker, because when you look at what he has written, it is not a theory of what an organised socialist country should be like, but how capitalism will be in the future. Contrary to the caricature of Marxism, he is first an admirer of capitalism. For him, it is a much better system than any other before it, because he considers the earlier systems to be obscurantist. Once or twice he had the idea that it was going to be the end, but he very rapidly decided that this was not the case, and that capitalism had a huge future.

What is very modern also in his view is that he considered that capitalism would end only when it was a global force, when the whole of the working class was part of it, when nations disappeared, when technology was able to transform the life of a country. He mentioned China and India as potential partners of capitalism, and said, for instance, that protectionism is a mistake, that free trade is a condition for progress.

For Marx, capitalism has to be worldwide before we think about socialism. Socialism for him is beyond capitalism and not instead of capitalism. He has much say on globalisation, what is happening to movement of companies, delocalisation and everything that is linked to the way we live today. In a sense, the Soviet Union was destroying or interrupting the validity of Marx's thinking and the fall of the Berlin Wall is giving back a raison d’être to his work, because Marx was thinking of the world globally and the Soviet system was a nightmare that he did not forecast."

miles_matthias• 7 years ago

It’s very interesting to me that he didn’t mention the B Corp organization, who attempts to do exactly that. Is there a reason for this? Maybe he thinks the requirements/audits are too burdensome?

_edo2• 7 years ago

...we need businesses and executives to value purpose alongside profit.

Profit is purpose. Profit means the value of the outputs of your business exceeds the value of its inputs. It means you've added something to society, it means you've provided a service to the public. It means when people actually have to choose what's important to them they value what your business has done for them.[0]

...where businesses...don’t just take from society but truly give back and have a positive impact.

See above.

I don't know why people think this thought process is new. Read The Road To Serfdom by Hayek. It was written in the 1940's about why these ideas don't work.

The free market is the best invention we know of for a society to express what it actually wants and to achieve those goals. Without it you have a small group of enlightened elites deciding what it is that people want.

Americans overwhelmingly say C.E.O.s should take the lead on economic and social challenges, and employees, investors and customers increasingly seek out companies that share their values....When government is unable or unwilling to act, business should not wait.

No. We don't want businesses to become political entities. If the problem is businesses aren't using their power for good, the solution isn't to give them even more power. That's too close to Fascism.

This whole essay is an argument that businesses need more social power and governments need more financial power. The trade-off is an increase in power inequality (because we're giving the powerful even more power) to decrease financial inequality. At the same time we'd probably take on massive dead-weight losses from abandoning the profit motive which is essential for our economy to function. That looks like a bad deal to me.

There is historical precedent for societies accepting power inequality to the extent of dictatorship in the name of ending the ills of capitalism. It hasn't worked well: https://en.wikipedia.org/wiki/Dictatorship_of_the_proletaria...

[0] - Yes, you can also steal. That's why capitalism exists within a legal framework.

jiveturkey4• 7 years ago

Profit is purpose.

Only in a capitalistic system, which he is arguing needs revision. Your argument is therefore tautological.

_edo2• 7 years ago

My argument only requires that people own their own property/labor and have the freedom to trade those things with others.

Without those freedoms we're in some dystopian/totalitarian state.

geebee3• 7 years ago

I agree with Marc that many of the things he'd like to do will take money. Solving homelessness in San Francisco, for instance, will cost a lot. But that doesn't mean all we need to do is spend some money. We've tried that - we're already up to a conservatively estimated $300 million a year. But plenty of people, hardly all on the right - including Gavin Newsom, who admits he was behind some of these failed attempts, for instance - opposed Benioff's initiative on the grounds that if we keep spending money they way we've been spending it, another 300 million will just make things worse off.

And while San Francisco may be a wealthy city, there's only so many times we can go to the well. As an example, every year there's a story in the Chron about how low and middle income San Franciscans sit at their computers with a list of affordable city run summer programs for kids, looking at the international clock, desperate to hit "submit" as if it's tickets to a Stones reunion tour - and the aftermath and scramble for where to put their kid this summer if they don't get them, which is about half the time. 300 mil would go a long way to helping with the middle and low income families that San Francisco is, frankly, bleeding away.

If I thought 300 mil more would solve homelessness, I'd happily spend it - hell, I'd triple it. I grew up here and I still love this city, but things are bad. The main difference between me and the people who bash SF here on HN is that to me, it's extremely painful, I don't get the gleeful thrill of pointing out how shitty SF's policies have made things, it hurts. I'd be willing to dig pretty deep into my limited financial assets if I could see it get better. But unfortunately, I really do think that 300 million more of the same will produce, well more of the same, which is things getting worse and worse.

easytiger2• 7 years ago

It's literally impossible to "solve homelessness". You can't stop someone walking I to your town and sitting down on the street.

Thats not even getting into what you allude to, in that "solving it" creates more homelessness

geebee3• 7 years ago

I agree. There's also a huge ambiguity in the term "homeless". This ambiguity was not an accident, I believe it is deliberate and is designed to serve a political purpose.

What I mean is, currently there is a large population of mentally ill and drug addicted people on San Francisco's streets, and many of San Francisco's residents and visitors are frequently berated, threatened, harassed, stalked, and even assaulted as they go about their business or vacations.

By "solve" I mean a humane and effective plan to greatly reduce this phenomenon. In spite of the intense and angry disagreements about what a humane and effective plan will be (must be?), I do think we (almost) all can agree on this as our objective. And in spite of my frustrations with Benioff, I do believe he sincerely wants the same thing I do.

jiveturkey4• 7 years ago

sigh. Benioff again with his convenient philanthropy. Berating the system he was happy to and remains happy to take advantage of. Whilst shaming others, that are in in less to much less good positions to demonstrate largesse, to act.

Honest question, why do people listen to this guy?

OK, he does try to start off strong: "Capitalism, I acknowledge, has been good to me." But it's not quite true, is it. It's not as if he was a disinterested 3rd party, strong in his belief of equality (socialism if we take it to extreme), that had capitalism foisted upon him.

Sorry, but for me the messenger has tainted the message. It's a clear do-as-I-say, not-as-I do.

https://www.businessinsider.com/salesforce-ceo-marc-benioff-...

It's behind a paywall, sorry. The headline is: Salesforce CEO Marc Benioff made $4,653,362 for fiscal year 2018 — a total made up of $1,550,000 in base salary, and $3,100,000 in non-equity insentive compensation. This means that the median employee got paid at a rate of 1-to-30, raking in about 3% of what Benioff made.

jshaqaw• 7 years ago

I often wonder why people who write these things don’t start with donating the mass of their fortunes first. Benioff could donate 5b to address poverty causes and still have more than a billion left over for himself.

WilliamEdward4• 7 years ago

It could be greed, but i'd say its more likely they don't even understand that they could be doing good things with their money.

Marc Benioff: We Need a New Capitalism

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