Consider Michael Douglas' speech in Wall Street where he basically lays out the capitalist owners' mantra: I don't produce things, I own them. He is willing to break up a company and sell it off, putting people out of work, as long as it makes him money. Is the purpose of a company really supposed to be that it gets shut down?Wall Street was an unbalanced treatment of the subject, and although it is told mostly from the perspective of the investors, it is intentionally scripted in a biased fashion aimed at provoking a reaction against those same players.
A far better movie on the subject was 'Other People's Money' where the issues were presented much more clearer. Even though Gregory Peck is presented as a man of character interested in the employees and Danny Devito as a raiding scumbag, the argument they have in their final speeches cuts through all the crap and exposes it in a much better fashion than Wall Street.
Does the company exist so that you may invest in it? I propose that the company exists so that its employees may earn a living. The capitalist system has proven to be the most efficient at attracting resources to a given endeavor, but has caused people to believe -- incorrectly IMO -- that serving the investors is the primary purpose of that endeavor.By definition, a capitalist system is based on the very foundation of ownership of factories. The ownership of that capital entitles the ownership to do with it what it wants. Employees have four options if they don't like the way a company treats them: (1) find employment elsewhere; (2) have or develop skills which increase your potential to generate profit for the company beyond which other such employees can attain; (3) live with it; or (4) organize a collective bargaining unit. Even in the case of Unions, collective bargaining does not bestow ownership of capital to the labor class - unless, of course, they arrange some sort of employee stock options.
If a company is breaking even and its employees are getting paid, I don't think it should be broken up just because it makes the owners more money that way. I don't think a CEO should cut a company's workforce by 30%, saving $16-million and driving the stock price up by 3 points in the process, only to be rewarded by the board with a $16-million bonus.Well, in the case you cite, the market is saying that this company should be smaller - remember that the market says things by assigning a monetary value to actions - an opportunity cost per se. As the movie I cite above talks about, you want to use my money to keep people on the payroll - essentially robbing me of the freedom to invest in other companies that may, just may, be more efficient and viable in the long term.
More fundamentally, the problem with your analysis is that it is wishful thinking, when not accompanied by some economic motivation. Companies are owned by stockholders - it's a capitalist system where the investors, not labor, own the means of production. Just because we think that the system should care about their employees does not make it so. As I've stated several times, business (by which I mean the owners of business) are in this to make money. They are not in it just to perform some social good, especially if it effects their bottom line.
As for my own perspective, I would probably agree that a business should care about their employees - especially if I'm the employee involved. The difference is that I think it a self-delusion to think that business operates for any other purpose than to make money - be it for the sake of the stockholders, management, or employees. Since this is a capitalist system, employees are on the low end of the totem pole. And upper management, which are usually coaxed with stock options, is invariably going to side with the stockholders.
Any example of how abhorrent management can be in their treatment of employees is quite simply nothing more than proving my point - money is what talks.