Are U.S. capitalists going soft?

The aristocracy of American capitalism can be found on the membership list of the Business Roundtable. The Roundtable, one of Washington's top lobbyists, includes among its 193 members the chief executives of the cream of the country's corporations, including Amazon, Apple, Fox, Coca-Cola, General Motors, Goldman Sachs and dozens of others. The organization has for many years declared in its “statement on the purpose of a corporation” that corporations exist principally to serve their shareholders.

They have now issued a new statement that renounces the concept of shareholder primacy. It includes their responsibilities to their customers, employees, suppliers and communities equally to those to their shareholders. The statement concludes, "Each of our stakeholders is essential. We commit to deliver value to all of them, for the future success of our companies, our communities and our country." Sounds almost noble.

Milton Friedman must be rolling in his grave. The Nobel prize-winning economist preached that “the social responsibility of business is to increase its profits” and American business faithfully followed their guru. It seems they are now discovering, as have others, that Friedman's single-minded devotion to the free market was misguided. "The American dream is alive, but fraying," said Jamie Dimon, CEO of JPMorgan Chase and Chairman of the Roundtable.

Not surprisingly, the organization's statement has its cynics. As a columnist in the Washington Post points out, "There are no specific targets nor ways of meeting, measuring or enforcing them. There is nothing on over-the-top executive compensation, which is the source of much public outrage." He concludes, "This is mostly a public relations exercise, designed to preempt more federal regulation."

And he may be right. Perhaps the CEOs are suffering a bout of nerves with Bernie Sanders, Elizabeth Warren and other Democrats snapping at their heels. But let's be optimistic. Given the immense influence of business interest in U.S. government, this could be a big deal if it results in action. If they commit to raising the pay and working conditions of service sector workers; if they commit to the fight against global warming; if they commit to high environmental standards ... If. We must wait and see.