14 management questions - Business Influence on Govt

timer Asked: Nov 6th, 2016

Question description

Answer the following questions and also the 4 questions on page 11 of the attached Ch. 12 PDF, in the Ethics in Practice Case "Double Irish Strategy" You should recognize that your answers to these discussion questions should be well reasoned and supported with evidence. Make certain that you use chapter material and theory as the basis for your answers. No outside material. All work must be original as this will be submitted through Turnitin. No plagiarism.


1. Briefly explain how business and government represent a clash of ethical systems (belief systems). With which do you find yourself identifying most? Explain. With which would most business students identify? Explain.

2. Explain why the public is included as a separate group in the interactions among business, government, and the public. Doesn’t government represent the public’s interests? How should the public’s interests be manifested?

3. What is regulation? Why does government see a need to regulate? Differentiate between economic and social regulation. What social regulations do you think are most important, and why? What social regulations ought to be eliminated? Explain.

4. Outline the major benefits and costs of government regulation. In general, do you think the benefits of government regulation exceed the costs? In what areas, if any, do you think the costs exceed the benefits?

5. What are the trade-offs between privatization and federalization? When would one or the other be more appropriate? What problems might you foresee and what future events would merit a shift in the current mix?

6. Explain lobbying in your own words. Describe the different levels at which lobbying takes place. Why do you think there is a lack of unity among the umbrella organizations?

7. What is a PAC? What are the major arguments in favor of PACs? What are the major types of PACs and how do they differ? In your opinion, are PACs a good way for business to influence the public policy process? What changes would you recommend for PACs?

8. Discuss Citizens United and Speechnow and their likely effect on future elections. What, if any, reforms would you recommend?

9. What does corporate accountability mean to you? How important is corporate political transparency?

10. What are the limits of corporate political strategy? Are there lines that companies should not cross? If so, what are they?

Chapter  11   Business,   Government,   and  Regula8on   BOBBY  BURGER  -­‐  CSUEB   1   HA  HA  FUNNY!!!   BOBBY  BURGER  -­‐  CSUEB   2   Business,  Government,     and  Regula;on   •  The  government  tends  to  become  involved   in  business  aCer  serious  problems  arise,  and   there  has  been  no  shortage  of  problems.     •  The  first  decade  of  the  21st  century  saw  the   tech  stock  plunge,  and  the  Enron,   WorldCom  and  other  scandals.  The  collapse   of  the  housing  market  put  the  economy  on   the  brink  of  collapse.     •  That  decade  swung  the  pendulum  of   government  involvement  in  business  from   minimal  to  major  player.     BOBBY  BURGER  -­‐  CSUEB   3   The  Pendulum  of     Government’s  Role  in  Business   •  The  areas  in  which  government  regulates   change,  and  its  varying  roles  increase  the   complexity  of  its  rela8onship  with  business.   Government  can:   •  Determine  the  rules  of  the  game   •  Be  a  major  purchaser  with  buying  power  that   can  affect  a  business’  or  industry’s  chances  of   survival   •  Strengthen  some  businesses  and  weaken  others   •  Create  new  businesses  and  industries  through   subsidiza8on  and  priva8za8on     BOBBY  BURGER  -­‐  CSUEB     4   The  Roles  of     Government  and  Business   •  For  effec8ve  management,  government’s  role   as  a  stakeholder  must  be  understood.   •  What  should  be  the  respec8ve  roles  of  business   and  government  in  our  socioeconomic  system?   •  If  the  role  of  business  were  simply  produc8on   and  distribu8on  of  goods  and  services,  business   would  need  liUle  regula8on.   •  But  other  goals  exist  –  safe  working   environment,  equal  employment  opportuni8es,   fair  pay,  clean  air,  safe  products  –  which   business  does  not  automa8cally  factor  into  the   business  decision  making  process.   •  As  a  result,  it  falls  to  government  to  ensure   those  goals  are  achieved.     BOBBY  BURGER  -­‐  CSUEB     5   A  Clash  of  Ethical  Systems   Business  Beliefs   Government  Beliefs   Individualis8c  ethic   Collec8vis8c  ethic   Maximizes  concession  to   Subordinates  individual   self-­‐interest   goals  and  self-­‐interest  to   group  goals  and  group   interests   Minimizing  the  load  of   obliga8ons  society   imposes  on  the   individual  (personal   freedom)   Maximizing  obliga8ons   assumed  by  the   individual  and   discourages  self-­‐interest   Emphasizes  inequali8es   of  individuals   Emphasizes  equality  of   individuals   BOBBY  BURGER  -­‐  CSUEB   6   Interac;on  of  Business,   Government,  and  the  Public  (1  of  2)   Government-­‐Business  rela;onship  -­‐   •  Government  influences  business  through   regula8on,  taxa8on,  and  more.     •  Business  influences  government  by  lobbying,   and  more   Public-­‐Government  rela;onship  -­‐   •  Public  influences  government  through   vo8ng  and  forming  special  interest  groups.     •  Government  influences  the  public  with   poli8cking,  public  policy  forma8on,  and   other  poli8cal  influences.     BOBBY  BURGER  -­‐  CSUEB   7   Interac;on  of  Business,   Government,  and  the  Public  (1  of  2)   Business-­‐Public  rela;onship  -­‐   •  Business  influences  the  public  through   adver8sing,  public  rela8ons,  and  other   forms  of  communica8on   •  The  public  influences  business  through   the  marketplace,  or  by  forming  special   interest  groups.       BOBBY  BURGER  -­‐  CSUEB   8   Interac;on  Among  Business,   Government,  and  the  Public   Lobbying   Business   •  Interest     groups   •  Not  buying     products   •  Protests   Regula;ons  and  Other   Forms  of  Persuasion   Government   • Poli;cal  Process   • Vo;ng   • Interest  Groups   • Contribu;ons   • Adver;sing   • Public  Rela;ons   •  Poli;cking   •  Poli;cal   influence   Public   BOBBY  BURGER  -­‐  CSUEB   9   Government’s  Nonregulatory   Influence  on  Business   Two  major  nonregulatory  issues  -­‐     •  Industrial  policy  -­‐   •  Concerned  with  the  role  of  government   in  a  na8onal  economy.   •  Priva;za;on  -­‐   •  Whether  current  public  func8ons  (e.g.,   public  educa8on,  public  transit,  social   security,  fire  service)  should  be  turned   over  to  the  private  (business)  sector?   BOBBY  BURGER  -­‐  CSUEB     10   Industrial  Policy   Industrial  policy  -­‐     •  Every  form  of  state  interven8on  that  affects   industry  as  a  dis8nct  part  of  the  economy.   •  A  current  trend  toward  stronger  industrial   policy  is  likely  to  con8nue  while  the  world   economy  works  to  recover  from  the  global   financial  crisis.       BOBBY  BURGER  -­‐  CSUEB     11   Priva;za;on   Priva;za;on  -­‐     •  The  process  of  changing  a  public   organiza8on  to  private  control  or   ownership.     •  The  intent  is  to  capture  the  discipline  of  the   free  market  and  a  spirit  of  entrepreneurial   risk-­‐taking.     •  Two  func8ons  a  government  might  perform:   •  Producing  a  service   •  Providing  a  service   BOBBY  BURGER  -­‐  CSUEB   12   The  Priva;za;on  Debate   Pro-­‐Priva;za;on  -­‐   •  Government  has  no  compara8ve  advantage  in   many  func8ons.   •  Government  is  less  efficient  and  less  flexible.   An;-­‐Priva;za;on  -­‐   •  Some  ac8vi8es  cannot  be  effec8vely   handled  by  the  private  sector.   •  Priva8za8on  produces  uneven  results  in   efficiency  gains  and  cost  savings.   •  Priva8za8on  works  best  when  the  pursuit  of   profits  does  not  work  against  broader  social   goals  or  public  policy.   BOBBY  BURGER  -­‐  CSUEB     13   Other  Nonregulatory     Government  Influences   Government  is:     •  •  •  A  major  employer   A  standard  seUer   One  of  the  largest  purchasers   Government  influences  business  by:   •  •  •  •  •  •  The  use  of  Subsidies   Transfer  payments   Loans  and  loan  guarantees   Taxa8on   Monetary  policy   Moral  suasion   BOBBY  BURGER  -­‐  CSUEB       14   Government’s     Regulatory  Influence  on  Business   •  Government  Regula8on  has  become  the  most   controversial  in  the  business-­‐government   rela8onship,  affec8ng  every  aspect  of  how   business  func8ons.     •  Most  people  agree  that  some  regula8on  is   necessary  to  ensure  that  consumers  and   employees  are  treated  fairly,  and  not  exposed   to  hazards,  and  to  protect  the  environment.     •  However,  businesses  also  think  that   regula8on  has  oCen  been  too  extensive  in   scope,  too  costly,  and  burdensome  in  terms   of  red  tape.     BOBBY  BURGER  -­‐  CSUEB   15   Regula;on  -­‐  What  Does  It  Mean?   Regula;on  -­‐     •  The  act  of  governing,  direc8ng  according  to   rule,  or  bringing  under  the  control  of  law  or   cons8tuted  authority.   •  A  federal  regulatory  agency  -­‐   •  •  •  •  •    Has  decision-­‐making  authority   Establishes  standards   Operates  principally    on  domes8c  business     Has  members  appointed  by  the  President   subject  to  Senate  confirma8on   Has  its  legal  procedures  governed  by  the   Administra8ve  Procedures  Act   BOBBY  BURGER  -­‐  CSUEB   16   Reasons  for  Regula;on   Most  regula8on  arises  out  of  a  market  failure.   Controlling  natural  monopolies   Controlling  nega;ve  externali;es   Achieving  social  goals   Controlling  excess  profits   Controlling  excessive  compe;;on     BOBBY  BURGER  -­‐  CSUEB   17   Types  of  Regula;on  (1  of  2)   Interstate  Commerce  Commission   Economic   Regula;on   Civil  Aeronau;cs  Board   Federal  Communica;ons  Commission   BOBBY  BURGER  -­‐  CSUEB   18   Types  of  Regula;on  (2  of  2)   Equal  Employment   Opportunity  Commission   Social   Regula;on   Occupa;onal  Safety  and     Health  Administra;on   Environmental  Protec;on  Agency   BOBBY  BURGER  -­‐  CSUEB   19   Comparison  of     Economic  and  Social  Regula;on                                Economic  Regula;ons   Social  Regula;ons   Focus   Market  condi8ons;   economic  variables   People  in  roles  as   employees,  consumers  and   ci8zens   Affected   Industries   Selected  (railroads,  aeronau8cs,   communica8ons)   Virtually  all  industries   Examples   CAB   FCC   EEOC,  OSHA,     CPSC,  EPA   Current   Trend   Had  been  moving  from   regula8on  to  deregula8on,  but   fallout  from  the  economic  crisis   reversed  the  trend   Efforts  underway  to  create   an  independent  consumer   financial  protec8on  agency   BOBBY  BURGER  -­‐  CSUEB   20   Issues  Related  to  Regula;on  -­‐   Innova;on  may  be  affected  –     • When  corporate  budgets  must  focus  on  “defensive   research”  certain  types  of  innova8on  are  less  likely  to   take  place.     New  investments  in  plant  and  equipment   may  be  affected  –   • To  the  extent  that  corporate  funds  must  be  used  for   regulatory  compliance,  they  are  diverted  from  more   produc8ve  uses.     Small  business  may  be  adversely  affected  –   • Federal  regula8ons  can  have  a  dispropor8onately   adverse  effect  on  small  firms  because  of  the  (lack  of)   economies  of  scale.     BOBBY  BURGER  -­‐  CSUEB   21   Deregula;on  -­‐   Represents  a  counterforce  -­‐      aimed  at   keeping  the  economy  in  balance.  A  con8nual   striving  for  the  balance  of  freedom  and  control   for  business  will  be  best  for  society.     Purpose    of  Deregula;on  -­‐   •  Intended  to  increase  compe88on  with   hopes  for  greater  efficiency,  lower  prices,   and  enhanced  innova8on.     BOBBY  BURGER  -­‐  CSUEB   22   The  Changing  World  of  Deregula;on     •  Deregula8on  which  began  in  the  1980s  had   mixed  results.   •  Some  prices  fell,  but  more  compe8tors  were   unable  to  compete  with  the  dominant  firms.   •  The  savings  &  loan  industry  crisis  cost  the   government  a  $124  billion  bailout.   •  Repeal  of  the  Glass-­‐Steagall  Act  caused  the   global  recession  that  began  in  2008.     •  The  dilemma  is  how  to  enhance  compe88on   without  sacrificing  applicable  social   regula8ons    such  as  health  and  safety   requirements.   BOBBY  BURGER  -­‐  CSUEB     23  
Chapter  12   Business   Influence  on   Government   and  Public   Policy   BOBBY  BURGER  -­‐  CSUEB   1   Business  Influence  on     Government  and  Public  Policy   •  Government  is  a  central  stakeholder  of   business,  and  its  interest  is  broad  and   mulEfaceted.   •  Government’s  power  is  derived  from  its  legal   and  moral  right  to  represent  the  public  in  its   dealings  with  business.     •  Society  would  be  best  served  if  the  system   maintained  a  balance  of  power,  but  a   controversial  U.S.  Supreme  Court  ruling   (Ci#zens  United  v.  Federal  Elec#on  Commission)   has  leK  business  with  the  power  to  drive  the   poli

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