A surprise ending that you should have seen coming

Timothy Taylor, Some Notes on Corporations and Social Values:

There is a long-standing debate over the goals of corporations. Should they focus mostly or exclusively on earning profits? Should they be willing to take on broader social missions? Should they be required to do so?...

At least among economists, the usual starting point for these discussions is an essay written by Milton Friedman in the New York Times on September 13, 1970, called "A Friedman doctrine -- The Social Responsibility of Business is to Raise its Profits." As with many things written by Friedman, it is a starting point both for those who agree and who disagree, because of the clarity and pungency with which his views are expressed...

A point Friedman does not state explicitly in this essay, but is implicit to many economists, is that the "social value" of a corporation lies partly in the way that it uses know-how and work to organize and combine various resources--workers, physical capital, and knowledge that can range from breakfast recipes to pharmaceutical formulas. By acting in this way, a corporation provides a service that customers believe is worth their money and jobs that workers believe are worth accepting, as well as buying inputs and supplies from other businesses and thus supporting them as well. If a company consistently makes losses and does not earn profits, these benefits will be lost. On the other side, a company that earns profits then has access to finance that could be used to expand in a way that satisfies more customer and hires more workers.

It seems to me that many discussions of the "social responsibility" of firms do not pay sufficient attention to these gains from pleasing customers and paying workers and suppliers. Such gains should not be taken for granted.

It seems to me that many, many discussions of "finance that could be used to expand in a way that satisfies more customer and hires more workers" do not pay any attention to the increase in financial costs that goes hand in hand with the rise of finance.

Such costs should not be taken for granted.