Six years ago I ruffled some feathers at a conference organized by the friends of Milton Freidman of the Chicago School of Economics. Friedman is the father of Monetarism, an economic ideology that has taken the world by storm. It has elevated neo-liberal economics and politics to the stratosphere and is now responsible for most of the instability that world economies are grappling with: Record government and private sector debt, bubble economies everywhere, and dangerously high balance sheets of the world’s top central banks. It delegitimized the very function of central banking and contributed to social instability and the greatest wealth gap in modern US history.

If you live in capitalist society, the best way to understand Friedman’s philosophy is by substituting the words “only money matters” for everything that ails you personally. If your wife leaves you, only money matters, you get a better-looking trophy wife right out of a catalog. If your dog dies, only money matters, you buy a more expensive dog. If government takes too much of your paycheck, only money matters, you kill government institutions, or you buy its politicians.  Focusing solely on the power of money and the overuse of monetary policy as prescribed by Freidman -as foolish as it seemed- became the dominant thinking in the world’s leading universities and at its most valued corporation.

The controversy at that conference started when I criticized Freidman for leading corporate America to believe that the sole purpose of a publically traded corporation is to serve the stockholder. Repeat after me, only money matters. Several people walked out of the room when I introduced the stakeholder model that’s at the heart of the MEMEnomics Corporate Sustainability Platform. You can call it Other Things Matter More. This is a model that serves the 5 P’s for Sustainability in the MEMEnomics-Spiral Dynamics framework: Purpose, Profit, People, Planet, and Process. A modified version of Don Beck’s original conception has been adopted by the Conscious Capitalism Movement, which continues to be informed by the Spiral Dynamics model till this day.

Friedman’s ideas represented a legitimate way for businesses to abandon all other virtues that fall under corporate social responsibility and pursue the sole goal of making money. So much so, that in 1978 the Business Roundtable which is made up of the most powerful CEOs on the planet, adopted Friedman’s guidelines as its end-all be-all source for corporate governance. So, why is this relevant today? In 40 plus years, the Business Roundtable has rarely deviated from supporting what they call shareholder primacy – until a few days ago.

On August 19, 2019 the Business Roundtable, in a major shift in focus announced that it’s moving away from the stockholder model and embracing a commitment to stakeholders such as employees and suppliers. The signatories to this statement are the who’s who of the most powerful corporations in the world, from Apple’s Tim Cook, to Amazon’s Jeff Bezos and heads of every Pharmaceutical and Oil Company on the planet and everything in between. (Click here to read the full statement and see the list of signatories)

Does this new statement of corporate purpose reverse the damage that monetarism has caused over the last 4 decades? Since 1978, nothing has been more important for the American corporation than preserving shareholder value. Capitalism became a simple mathematical equation. On one side was management hiding behind this fallacy of efficiency for the sake of the shareholder and on the other was the worker fighting the uphill battle to keep his job. The working class that built American cities and factories and those who supplied them became a variable in an equation that needed to be reduced to as close to zero as possible.

Fighting for the shareholder became a blood sport. This wasn’t a fiduciary responsibility like it’s supposed to be. To attract this rare industrial butcher talent, CEOs were offered a generous amount stock and their compensation was tied directly to the price of that stock. The brightest Friedman clones had taken over corporate America and its financial markets and they immediately went to work. They increased the price of the economic pie instead of creating a bigger pie because only money mattered. Jobs were outsourced, streamlined and offshored because only money mattered. Businesses, large and small were securitized, monetized, and downsized, because only money mattered. Jobs, unions and workers disappeared and you guessed it because only money mattered. Then as this whole house of cards was crashing down in 2008, instead of seeing the fallacy of an economy based on Monetarism our clueless politicians finished the job of debauching whatever value was left of our currency by making money available at 6 times the normal liquidity.

The Business Roundtable’s new declaration from a few days ago is like a statement made by a habitual criminal in court proclaiming innocence and vowing to change his ways. It reminds me of the movie series The Purge where, in a dystopian America, mayhem, anarchy, and murder are condoned for one night out of a year and where reality looks a lot different the morning after.  Well, corporate America has been purging its stakeholders for four decades in favor of those who became the 1%. They have systemically murdered any sense of loyalty they have for Main Street America. Now, They are realizing that the purging is reaching an ugly end and that a new and threatening dawn is on the horizon.

These powerful CEOs are looking to mitigate the damage caused by the rise of a new economic era that doesn’t fit their narrative for business as usual. It’s driven by those who haven’t drunk the shareholder Kool-Aid. They see the anger of the Millennials who witnessed their parents’ jobs being downsized then outsourced to places where slave labor increased shareholder value. They don’t understand why this new generation would rather “share” than “own.” They spend billions on consumer research but they won’t bother to look inward to examine their own conscious and sense of patriotic duty. What they do see is a new breed of politicians who are ready to put an end to the fallacy of an economy based entirely on money and stockholder value.

When only money matters, unending greed becomes the only virtue. When that virtue defines corporate values and culture for over four decades, the behavior becomes the norm. Jeff Bezos is a man who’s company put tens of thousands of stakeholder mom and pop shops out of business. When he says he supports the new stakeholder model, I have my doubt about corporate America being in touch with the stakeholder. If my work with evolutionary values over the last two decades tells me anything, it’s this: corporate America has become the habitual criminal in the court of public opinion, and with all it’s arrogance and desperation it’s asking us to believe that it’s ready to voluntarily go on the straight and narrow path. What it hasn’t noticed is that the judge and jury have changed. The pendulum is swinging the other way. It’s empowered by a culture with higher values and a new breed of politicians who see the deep damage that Milton Friedman has caused to the cultural fabric of America and the world.