The Lewis Powell Memo
(also known as the Powell Manifesto)
[Lewis F. Powell a corporate lawyer,
became President Nixon's nominee to the U.S. Supreme Court. This
memo, dated August 23, 1971, was sent to Eugene Sydnor, Jr., Director
of the U.S. Chamber of Commerce]
Confidential Memorandum: Attack
of American Free Enterprise System
DATE: August 23, 1971
TO: Mr. Eugene B. Sydnor, Jr., Chairman,
Education Committee, U.S. Chamber of Commerce
FROM: Lewis F. Powell, Jr.
This memorandum is submitted at your request
as a basis for the discussion on August 24 with Mr. Booth (executive
vice president) and others at the U.S. Chamber of Commerce. The
purpose is to identify the problem, and suggest possible avenues
of action for further consideration.
Dimensions of the Attack _No thoughtful
person can question that the American economic system is under
broad attack.1 This varies in scope, intensity, in the techniques
employed, and in the level of visibility.
There always have been some who opposed
the American system, and preferred socialism or some form of statism
(communism or fascism). Also, there always have been critics of
the system, whose criticism has been wholesome and constructive
so long as the objective was to improve rather than to subvert
But what now concerns us is quite new
in the history of America. We are not dealing with sporadic or
isolated attacks from a relatively few extremists or even from
the minority socialist cadre. Rather, the assault on the enterprise
system is broadly based and consistently pursued. It is gaining
momentum and converts.
Sources of the Attack_The sources are
varied and diffused. They include, not unexpectedly, the Communists,
New Leftists and other revolutionaries who would destroy the entire
system, both political and economic. These extremists of the left
are far more numerous, better financed, and increasingly are more
welcomed and encouraged by other elements of society, than ever
before in our history. But they remain a small minority, and are
not yet the principal cause for concern.
The most disquieting voices joining the
chorus of criticism come from perfectly respectable elements of
society: from the college campus, the pulpit, the media, the intellectual
and literary journals, the arts and sciences, and from politicians.
In most of these groups the movement against the system is participated
in only by minorities. Yet, these often are the most articulate,
the most vocal, the most prolific in their writing and speaking.
Moreover, much of the media-for varying
motives and in varying degrees-either voluntarily accords unique
publicity to these "attackers," or at least allows them
to exploit the media for their purposes. This is especially true
of television, which now plays such a predominant role in shaping
the thinking, attitudes and emotions of our people.
One of the bewildering paradoxes of our
time is the extent to which the enterprise system tolerates, if
not participates in, its own destruction.
The campuses from which much of the criticism
emanates are supported by (i) tax funds generated largely from
American business, and (ii) contributions from capital funds controlled
or generated by American business. The boards of trustees of our
universities overwhelmingly are composed of men and women who
are leaders in the system.
Most of the media, including the national
TV systems, are owned and theoretically controlled by corporations
which depend upon profits, and the enterprise system to survive.
Tone of the Attack_This memorandum is
not the place to document in detail the tone, character, or intensity
of the attack. The following quotations will suffice to give one
a general idea:
William Kunstler, warmly welcomed on campuses
and listed in a recent student poll as the "American lawyer
most admired," incites audiences as follows:
"You must learn to fight in the streets,
to revolt, to shoot guns. We will learn to do all of the things
that property owners fear."2 The New Leftists who heed Kunstler's
advice increasingly are beginning to act -- not just against military
recruiting offices and manufacturers of munitions, but against
a variety of businesses: "Since February, 1970, branches
(of Bank of America) have been attacked 39 times, 22 times with
explosive devices and 17 times with fire bombs or by arsonists."3
Although New Leftist spokesmen are succeeding in radicalizing
thousands of the young, the greater cause for concern is the hostility
of respectable liberals and social reformers. It is the sum total
of their views and influence which could indeed fatally weaken
or destroy the system.
A chilling description of what is being
taught on many of our campuses was written by Stewart Alsop:
"Yale, like every other major college,
is graduating scores of bright young men who are practitioners
of 'the politics of despair.' These young men despise the American
political and economic system . . . (their) minds seem to be wholly
closed. They live, not by rational discussion, but by mindless
slogans."4 A recent poll of students on 12 representative
campuses reported that: "Almost half the students favored
socialization of basic U.S. industries."5
A visiting professor from England at Rockford
College gave a series of lectures entitled "The Ideological
War Against Western Society," in which he documents the extent
to which members of the intellectual community are waging ideological
warfare against the enterprise system and the values of western
society. In a foreword to these lectures, famed Dr. Milton Friedman
of Chicago warned: "It (is) crystal clear that the foundations
of our free society are under wide-ranging and powerful attack
-- not by Communist or any other conspiracy but by misguided individuals
parroting one another and unwittingly serving ends they would
never intentionally promote."6
Perhaps the single most effective antagonist
of American business is Ralph Nader, who -- thanks largely to
the media -- has become a legend in his own time and an idol of
millions of Americans. A recent article in Fortune speaks of Nader
"The passion that rules in him --
and he is a passionate man -- is aimed at smashing utterly the
target of his hatred, which is corporate power. He thinks, and
says quite bluntly, that a great many corporate executives belong
in prison -- for defrauding the consumer with shoddy merchandise,
poisoning the food supply with chemical additives, and willfully
manufacturing unsafe products that will maim or kill the buyer.
He emphasizes that he is not talking just about 'fly-by-night
hucksters' but the top management of blue chip business."7
A frontal assault was made on our government,
our system of justice, and the free enterprise system by Yale
Professor Charles Reich in his widely publicized book: "The
Greening of America," published last winter.
The foregoing references illustrate the
broad, shotgun attack on the system itself. There are countless
examples of rifle shots which undermine confidence and confuse
the public. Favorite current targets are proposals for tax incentives
through changes in depreciation rates and investment credits.
These are usually described in the media as "tax breaks,"
"loop holes" or "tax benefits" for the benefit
of business. * As viewed by a columnist in the Post, such tax
measures would benefit "only the rich, the owners of big
It is dismaying that many politicians
make the same argument that tax measures of this kind benefit
only "business," without benefit to "the poor."
The fact that this is either political demagoguery or economic
illiteracy is of slight comfort. This setting of the "rich"
against the "poor," of business against the people,
is the cheapest and most dangerous kind of politics.
The Apathy and Default of Business_What
has been the response of business to this massive assault upon
its fundamental economics, upon its philosophy, upon its right
to continue to manage its own affairs, and indeed upon its integrity?
The painfully sad truth is that business,
including the boards of directors' and the top executives of corporations
great and small and business organizations at all levels, often
have responded -- if at all -- by appeasement, ineptitude and
ignoring the problem. There are, of course, many exceptions to
this sweeping generalization. But the net effect of such response
as has been made is scarcely visible.
In all fairness, it must be recognized
that businessmen have not been trained or equipped to conduct
guerrilla warfare with those who propagandize against the system,
seeking insidiously and constantly to sabotage it. The traditional
role of business executives has been to manage, to produce, to
sell, to create jobs, to make profits, to improve the standard
of living, to be community leaders, to serve on charitable and
educational boards, and generally to be good citizens. They have
performed these tasks very well indeed.
But they have shown little stomach for
hard-nose contest with their critics, and little skill in effective
intellectual and philosophical debate.
A column recently carried by the Wall
Street Journal was entitled: "Memo to GM: Why Not Fight Back?"9
Although addressed to GM by name, the article was a warning to
all American business. Columnist St. John said:
"General Motors, like American business
in general, is 'plainly in trouble' because intellectual bromides
have been substituted for a sound intellectual exposition of its
point of view." Mr. St. John then commented on the tendency
of business leaders to compromise with and appease critics. He
cited the concessions which Nader wins from management, and spoke
of "the fallacious view many businessmen take toward their
critics." He drew a parallel to the mistaken tactics of many
college administrators: "College administrators learned too
late that such appeasement serves to destroy free speech, academic
freedom and genuine scholarship. One campus radical demand was
conceded by university heads only to be followed by a fresh crop
which soon escalated to what amounted to a demand for outright
One need not agree entirely with Mr. St.
John's analysis. But most observers of the American scene will
agree that the essence of his message is sound. American business
"plainly in trouble"; the response to the wide range
of critics has been ineffective, and has included appeasement;
the time has come -- indeed, it is long overdue -- for the wisdom,
ingenuity and resources of American business to be marshalled
against those who would destroy it.
Responsibility of Business Executives_What
specifically should be done? The first essential -- a prerequisite
to any effective action -- is for businessmen to confront this
problem as a primary responsibility of corporate management.
The overriding first need is for businessmen
to recognize that the ultimate issue may be survival -- survival
of what we call the free enterprise system, and all that this
means for the strength and prosperity of America and the freedom
of our people.
The day is long past when the chief executive
officer of a major corporation discharges his responsibility by
maintaining a satisfactory growth of profits, with due regard
to the corporation's public and social responsibilities. If our
system is to survive, top management must be equally concerned
with protecting and preserving the system itself. This involves
far more than an increased emphasis on "public relations"
or "governmental affairs" -- two areas in which corporations
long have invested substantial sums.
A significant first step by individual
corporations could well be the designation of an executive vice
president (ranking with other executive VP's) whose responsibility
is to counter-on the broadest front-the attack on the enterprise
system. The public relations department could be one of the foundations
assigned to this executive, but his responsibilities should encompass
some of the types of activities referred to subsequently in this
memorandum. His budget and staff should be adequate to the task.
Possible Role of the Chamber of Commerce
But independent and uncoordinated activity
by individual corporations, as important as this is, will not
be sufficient. Strength lies in organization, in careful long-range
planning and implementation, in consistency of action over an
indefinite period of years, in the scale of financing available
only through joint effort, and in the political power available
only through united action and national organizations.
Moreover, there is the quite understandable
reluctance on the part of any one corporation to get too far out
in front and to make itself too visible a target.
The role of the National Chamber of Commerce
is therefore vital. Other national organizations (especially those
of various industrial and commercial groups) should join in the
effort, but no other organizations appear to be as well situated
as the Chamber. It enjoys a strategic position, with a fine reputation
and a broad base of support. Also -- and this is of immeasurable
merit -- there are hundreds of local Chambers of Commerce which
can play a vital supportive role.
It hardly need be said that before embarking
upon any program, the Chamber should study and analyze possible
courses of action and activities, weighing risks against probable
effectiveness and feasibility of each. Considerations of cost,
the assurance of financial and other support from members, adequacy
of staffing and similar problems will all require the most thoughtful
The Campus_The assault on the enterprise
system was not mounted in a few months. It has gradually evolved
over the past two decades, barely perceptible in its origins and
benefiting (sic) from a gradualism that provoked little awareness
much less any real reaction.
Although origins, sources and causes are
complex and interrelated, and obviously difficult to identify
without careful qualification, there is reason to believe that
the campus is the single most dynamic source. The social science
faculties usually include members who are unsympathetic to the
enterprise system. They may range from a Herbert Marcuse, Marxist
faculty member at the University of California at San Diego, and
convinced socialists, to the ambivalent liberal critic who finds
more to condemn than to commend. Such faculty members need not
be in a majority. They are often personally attractive and magnetic;
they are stimulating teachers, and their controversy attracts
student following; they are prolific writers and lecturers; they
author many of the textbooks, and they exert enormous influence
-- far out of proportion to their numbers -- on their colleagues
and in the academic world.
Social science faculties (the political
scientist, economist, sociologist and many of the historians)
tend to be liberally oriented, even when leftists are not present.
This is not a criticism per se, as the need for liberal thought
is essential to a balanced viewpoint. The difficulty is that "balance"
is conspicuous by its absence on many campuses, with relatively
few members being of conservatives or moderate persuasion and
even the relatively few often being less articulate and aggressive
than their crusading colleagues.
This situation extending back many years
and with the imbalance gradually worsening, has had an enormous
impact on millions of young American students. In an article in
Barron's Weekly, seeking an answer to why so many young people
are disaffected even to the point of being revolutionaries, it
was said: "Because they were taught that way."10 Or,
as noted by columnist Stewart Alsop, writing about his alma mater:
"Yale, like every other major college, is graduating scores'
of bright young men ... who despise the American political and
As these "bright young men,"
from campuses across the country, seek opportunities to change
a system which they have been taught to distrust -- if not, indeed
"despise" -- they seek employment in the centers of
the real power and influence in our country, namely: (i) with
the news media, especially television; (ii) in government, as
"staffers" and consultants at various levels; (iii)
in elective politics; (iv) as lecturers and writers, and (v) on
the faculties at various levels of education.
Many do enter the enterprise system --
in business and the professions -- and for the most part they
quickly discover the fallacies of what they have been taught.
But those who eschew the mainstream of the system often remain
in key positions of influence where they mold public opinion and
often shape governmental action. In many instances, these "intellectuals"
end up in regulatory agencies or governmental departments with
large authority over the business system they do not believe in.
If the foregoing analysis is approximately
sound, a priority task of business -- and organizations such as
the Chamber -- is to address the campus origin of this hostility.
Few things are more sanctified in American life than academic
freedom. It would be fatal to attack this as a principle. But
if academic freedom is to retain the qualities of "openness,"
"fairness" and "balance" -- which are essential
to its intellectual significance -- there is a great opportunity
for constructive action. The thrust of such action must be to
restore the qualities just mentioned to the academic communities.
What Can Be Done About the Campus _The
ultimate responsibility for intellectual integrity on the campus
must remain on the administrations and faculties of our colleges
and universities. But organizations such as the Chamber can assist
and activate constructive change in many ways, including the following:
Staff of Scholars _The Chamber should
consider establishing a staff of highly qualified scholars in
the social sciences who do believe in the system. It should include
several of national reputation whose authorship would be widely
respected -- even when disagreed with.
Staff of Speakers _There also should be
a staff of speakers of the highest competency. These might include
the scholars, and certainly those who speak for the Chamber would
have to articulate the product of the scholars.
Speaker's Bureau _In addition to full-time
staff personnel, the Chamber should have a Speaker's Bureau which
should include the ablest and most effective advocates from the
top echelons of American business.
Evaluation of Textbooks _The staff of
scholars (or preferably a panel of independent scholars) should
evaluate social science textbooks, especially in economics, political
science and sociology. This should be a continuing program.
The objective of such evaluation should
be oriented toward restoring the balance essential to genuine
academic freedom. This would include assurance of fair and factual
treatment of our system of government and our enterprise system,
its accomplishments, its basic relationship to individual rights
and freedoms, and comparisons with the systems of socialism, fascism
and communism. Most of the existing textbooks have some sort of
comparisons, but many are superficial, biased and unfair.
We have seen the civil rights movement
insist on re-writing many of the textbooks in our universities
and schools. The labor unions likewise insist that textbooks be
fair to the viewpoints of organized labor. Other interested citizens
groups have not hesitated to review, analyze and criticize textbooks
and teaching materials. In a democratic society, this can be a
constructive process and should be regarded as an aid to genuine
academic freedom and not as an intrusion upon it.
If the authors, publishers and users of
textbooks know that they will be subjected -- honestly, fairly
and thoroughly -- to review and critique by eminent scholars who
believe in the American system, a return to a more rational balance
can be expected.
Equal Time on the Campus _The Chamber
should insist upon equal time on the college speaking circuit.
The FBI publishes each year a list of speeches made on college
campuses by avowed Communists. The number in 1970 exceeded 100.
There were, of course, many hundreds of appearances by leftists
and ultra liberals who urge the types of viewpoints indicated
earlier in this memorandum. There was no corresponding representation
of American business, or indeed by individuals or organizations
who appeared in support of the American system of government and
Every campus has its formal and informal
groups which invite speakers. Each law school does the same thing.
Many universities and colleges officially sponsor lecture and
speaking programs. We all know the inadequacy of the representation
of business in the programs.
It will be said that few invitations would
be extended to Chamber speakers.11 This undoubtedly would be true
unless the Chamber aggressively insisted upon the right to be
heard -- in effect, insisted upon "equal time." University
administrators and the great majority of student groups and committees
would not welcome being put in the position publicly of refusing
a forum to diverse views, indeed, this is the classic excuse for
allowing Communists to speak.
The two essential ingredients are (i)
to have attractive, articulate and well-informed speakers; and
(ii) to exert whatever degree of pressure -- publicly and privately
-- may be necessary to assure opportunities to speak. The objective
always must be to inform and enlighten, and not merely to propagandize.
Balancing of Faculties _Perhaps the most
fundamental problem is the imbalance of many faculties. Correcting
this is indeed a long-range and difficult project. Yet, it should
be undertaken as a part of an overall program. This would mean
the urging of the need for faculty balance upon university administrators
and boards of trustees.
The methods to be employed require careful
thought, and the obvious pitfalls must be avoided. Improper pressure
would be counterproductive. But the basic concepts of balance,
fairness and truth are difficult to resist, if properly presented
to boards of trustees, by writing and speaking, and by appeals
to alumni associations and groups.
This is a long road and not one for the
fainthearted. But if pursued with integrity and conviction it
could lead to a strengthening of both academic freedom on the
campus and of the values which have made America the most productive
of all societies.
Graduate Schools of Business _The Chamber
should enjoy a particular rapport with the increasingly influential
graduate schools of business. Much that has been suggested above
applies to such schools.
Should not the Chamber also request specific
courses in such schools dealing with the entire scope of the problem
addressed by this memorandum? This is now essential training for
the executives of the future.
Secondary Education _While the first priority
should be at the college level, the trends mentioned above are
increasingly evidenced in the high schools. Action programs, tailored
to the high schools and similar to those mentioned, should be
considered. The implementation thereof could become a major program
for local chambers of commerce, although the control and direction
-- especially the quality control -- should be retained by the
What Can Be Done About the Public? _Reaching
the campus and the secondary schools is vital for the long-term.
Reaching the public generally may be more important for the shorter
term. The first essential is to establish the staffs of eminent
scholars, writers and speakers, who will do the thinking, the
analysis, the writing and the speaking. It will also be essential
to have staff personnel who are thoroughly familiar with the media,
and how most effectively to communicate with the public. Among
the more obvious means are the following:
Television _The national television networks
should be monitored in the same way that textbooks should be kept
under constant surveillance. This applies not merely to so-called
educational programs (such as "Selling of the Pentagon"),
but to the daily "news analysis" which so often includes
the most insidious type of criticism of the enterprise system.12
Whether this criticism results from hostility or economic ignorance,
the result is the gradual erosion of confidence in "business"
and free enterprise.
This monitoring, to be effective, would
require constant examination of the texts of adequate samples
of programs. Complaints -- to the media and to the Federal Communications
Commission -- should be made promptly and strongly when programs
are unfair or inaccurate.
Equal time should be demanded when appropriate.
Effort should be made to see that the forum-type programs (the
Today Show, Meet the Press, etc.) afford at least as much opportunity
for supporters of the American system to participate as these
programs do for those who attack it.
Other Media _Radio and the press are also
important, and every available means should be employed to challenge
and refute unfair attacks, as well as to present the affirmative
case through these media.
The Scholarly Journals _It is especially
important for the Chamber's "faculty of scholars" to
publish. One of the keys to the success of the liberal and leftist
faculty members has been their passion for "publication"
and "lecturing." A similar passion must exist among
the Chamber's scholars.
Incentives might be devised to induce
more "publishing" by independent scholars who do believe
in the system.
There should be a fairly steady flow of
scholarly articles presented to a broad spectrum of magazines
and periodicals -- ranging from the popular magazines (Life, Look,
Reader's Digest, etc.) to the more intellectual ones (Atlantic,
Harper's, Saturday Review, New York, etc.)13 and to the various
Books, Paperbacks and Pamphlets _The news
stands -- at airports, drugstores, and elsewhere -- are filled
with paperbacks and pamphlets advocating everything from revolution
to erotic free love. One finds almost no attractive, well-written
paperbacks or pamphlets on "our side." It will be difficult
to compete with an Eldridge Cleaver or even a Charles Reich for
reader attention, but unless the effort is made -- on a large
enough scale and with appropriate imagination to assure some success
-- this opportunity for educating the public will be irretrievably
Paid Advertisements _Business pays hundreds
of millions of dollars to the media for advertisements. Most of
this supports specific products; much of it supports institutional
image making; and some fraction of it does support the system.
But the latter has been more or less tangential, and rarely part
of a sustained, major effort to inform and enlighten the American
If American business devoted only 10%
of its total annual advertising budget to this overall purpose,
it would be a statesman-like expenditure.
The Neglected Political Arena _In the
final analysis, the payoff -- short-of revolution -- is what government
does. Business has been the favorite whipping-boy of many politicians
for many years. But the measure of how far this has gone is perhaps
best found in the anti-business views now being expressed by several
leading candidates for President of the United States.
It is still Marxist doctrine that the
"capitalist" countries are controlled by big business.
This doctrine, consistently a part of leftist propaganda all over
the world, has a wide public following among Americans.
Yet, as every business executive knows,
few elements of American society today have as little influence
in government as the American businessman, the corporation, or
even the millions of corporate stockholders. If one doubts this,
let him undertake the role of "lobbyist" for the business
point of view before Congressional committees. The same situation
obtains in the legislative halls of most states and major cities.
One does not exaggerate to say that, in terms of political influence
with respect to the course of legislation and government action,
the American business executive is truly the "forgotten man."
Current examples of the impotency of business,
and of the near-contempt with which businessmen's views are held,
are the stampedes by politicians to support almost any legislation
related to "consumerism" or to the "environment."
Politicians reflect what they believe
to be majority views of their constituents. It is thus evident
that most politicians are making the judgment that the public
has little sympathy for the businessman or his viewpoint.
The educational programs suggested above
would be designed to enlighten public thinking -- not so much
about the businessman and his individual role as about the system
which he administers, and which provides the goods, services and
jobs on which our country depends.
But one should not postpone more direct
political action, while awaiting the gradual change in public
opinion to be effected through education and information. Business
must learn the lesson, long ago learned by labor and other self-interest
groups. This is the lesson that political power is necessary;
that such power must be assidously (sic) cultivated; and that
when necessary, it must be used aggressively and with determination
-- without embarrassment and without the reluctance which has
been so characteristic of American business.
As unwelcome as it may be to the Chamber,
it should consider assuming a broader and more vigorous role in
the political arena.
Neglected Opportunity in the Courts _American
business and the enterprise system have been affected as much
by the courts as by the executive and legislative branches of
government. Under our constitutional system, especially with an
activist-minded Supreme Court, the judiciary may be the most important
instrument for social, economic and political change.
Other organizations and groups, recognizing
this, have been far more astute in exploiting judicial action
than American business. Perhaps the most active exploiters of
the judicial system have been groups ranging in political orientation
from "liberal" to the far left.
The American Civil Liberties Union is
one example. It initiates or intervenes in scores of cases each
year, and it files briefs amicus curiae in the Supreme Court in
a number of cases during each term of that court. Labor unions,
civil rights groups and now the public interest law firms are
extremely active in the judicial arena. Their success, often at
business' expense, has not been inconsequential.
This is a vast area of opportunity for
the Chamber, if it is willing to undertake the role of spokesman
for American business and if, in turn, business is willing to
provide the funds.
As with respect to scholars and speakers,
the Chamber would need a highly competent staff of lawyers. In
special situations it should be authorized to engage, to appear
as counsel amicus in the Supreme Court, lawyers of national standing
and reputation. The greatest care should be exercised in selecting
the cases in which to participate, or the suits to institute.
But the opportunity merits the necessary effort.
Neglected Stockholder Power _The average
member of the public thinks of "business" as an impersonal
corporate entity, owned by the very rich and managed by over-paid
executives. There is an almost total failure to appreciate that
"business" actually embraces -- in one way or another
-- most Americans. Those for whom business provides jobs, constitute
a fairly obvious class. But the 20 million stockholders -- most
of whom are of modest means -- are the real owners, the real entrepreneurs,
the real capitalists under our system. They provide the capital
which fuels the economic system which has produced the highest
standard of living in all history. Yet, stockholders have been
as ineffectual as business executives in promoting a genuine understanding
of our system or in exercising political influence.
The question which merits the most thorough
examination is how can the weight and influence of stockholders
-- 20 million voters -- be mobilized to support (i) an educational
program and (ii) a political action program.
Individual corporations are now required
to make numerous reports to shareholders. Many corporations also
have expensive "news" magazines which go to employees
and stockholders. These opportunities to communicate can be used
far more effectively as educational media.
The corporation itself must exercise restraint
in undertaking political action and must, of course, comply with
applicable laws. But is it not feasible -- through an affiliate
of the Chamber or otherwise -- to establish a national organization
of American stockholders and give it enough muscle to be influential?
A More Aggressive Attitude _Business interests
-- especially big business and their national trade organizations
-- have tried to maintain low profiles, especially with respect
to political action.
As suggested in the Wall Street Journal
article, it has been fairly characteristic of the average business
executive to be tolerant -- at least in public -- of those who
attack his corporation and the system. Very few businessmen or
business organizations respond in kind. There has been a disposition
to appease; to regard the opposition as willing to compromise,
or as likely to fade away in due time.
Business has shunted confrontation politics.
Business, quite understandably, has been repelled by the multiplicity
of non-negotiable "demands" made constantly by self-interest
groups of all kinds.
While neither responsible business interests,
nor the United States Chamber of Commerce, would engage in the
irresponsible tactics of some pressure groups, it is essential
that spokesmen for the enterprise system -- at all levels and
at every opportunity -- be far more aggressive than in the past.
There should be no hesitation to attack
the Naders, the Marcuses and others who openly seek destruction
of the system. There should not be the slightest hesitation to
press vigorously in all political arenas for support of the enterprise
system. Nor should there be reluctance to penalize politically
those who oppose it.
Lessons can be learned from organized
labor in this respect. The head of the AFL-CIO may not appeal
to businessmen as the most endearing or public-minded of citizens.
Yet, over many years the heads of national labor organizations
have done what they were paid to do very effectively. They may
not have been beloved, but they have been respected -- where it
counts the most -- by politicians, on the campus, and among the
It is time for American business -- which
has demonstrated the greatest capacity in all history to produce
and to influence consumer decisions -- to apply their great talents
vigorously to the preservation of the system itself.
The Cost _The type of program described
above (which includes a broadly based combination of education
and political action), if undertaken long term and adequately
staffed, would require far more generous financial support from
American corporations than the Chamber has ever received in the
past. High level management participation in Chamber affairs also
would be required.
The staff of the Chamber would have to
be significantly increased, with the highest quality established
and maintained. Salaries would have to be at levels fully comparable
to those paid key business executives and the most prestigious
faculty members. Professionals of the great skill in advertising
and in working with the media, speakers, lawyers and other specialists
would have to be recruited.
It is possible that the organization of
the Chamber itself would benefit from restructuring. For example,
as suggested by union experience, the office of President of the
Chamber might well be a full-time career position. To assure maximum
effectiveness and continuity, the chief executive officer of the
Chamber should not be changed each year. The functions now largely
performed by the President could be transferred to a Chairman
of the Board, annually elected by the membership. The Board, of
course, would continue to exercise policy control.
Quality Control is Essential _Essential
ingredients of the entire program must be responsibility and "quality
control." The publications, the articles, the speeches, the
media programs, the advertising, the briefs filed in courts, and
the appearances before legislative committees -- all must meet
the most exacting standards of accuracy and professional excellence.
They must merit respect for their level of public responsibility
and scholarship, whether one agrees with the viewpoints expressed
Relationship to Freedom _The threat to
the enterprise system is not merely a matter of economics. It
also is a threat to individual freedom.
It is this great truth -- now so submerged
by the rhetoric of the New Left and of many liberals -- that must
be re-affirmed if this program is to be meaningful.
There seems to be little awareness that
the only alternatives to free enterprise are varying degrees of
bureaucratic regulation of individual freedom -- ranging from
that under moderate socialism to the iron heel of the leftist
or rightist dictatorship.
We in America already have moved very
far indeed toward some aspects of state socialism, as the needs
and complexities of a vast urban society require types of regulation
and control that were quite unnecessary in earlier times. In some
areas, such regulation and control already have seriously impaired
the freedom of both business and labor, and indeed of the public
generally. But most of the essential freedoms remain: private
ownership, private profit, labor unions, collective bargaining,
consumer choice, and a market economy in which competition largely
determines price, quality and variety of the goods and services
provided the consumer.
In addition to the ideological attack
on the system itself (discussed in this memorandum), its essentials
also are threatened by inequitable taxation, and -- more recently
-- by an inflation which has seemed uncontrollable.14 But whatever
the causes of diminishing economic freedom may be, the truth is
that freedom as a concept is indivisible. As the experience of
the socialist and totalitarian states demonstrates, the contraction
and denial of economic freedom is followed inevitably by governmental
restrictions on other cherished rights. It is this message, above
all others, that must be carried home to the American people.
Conclusion_It hardly need be said that
the views expressed above are tentative and suggestive. The first
step should be a thorough study. But this would be an exercise
in futility unless the Board of Directors of the Chamber accepts
the fundamental premise of this paper, namely, that business and
the enterprise system are in deep trouble, and the hour is late.
1 . Variously called: the "free enterprise
system," "capitalism," and the "profit system."
The American political system of democracy under the rule of law
is also under attack, often by the same individuals and organizations
who seek to undermine the enterprise system.
2 . Richmond News Leader, June 8, 1970.
Column of William F. Buckley, Jr.
3 . N.Y. Times Service article, reprinted
Richmond Times-Dispatch, May 17, 1971.
4 . Stewart Alsop, Yale and the Deadly
Danger, Newsweek, May 18. 1970.
5 . Editorial, Richmond Times-Dispatch,
July 7, 1971.
6 . Dr. Milton Friedman, Prof. of Economics,
U. of Chicago, writing a foreword to Dr. Arthur A. Shenfield's
Rockford College lectures entitled "The Ideological War Against
Western Society," copyrighted 1970 by Rockford College.
7 . Fortune. May, 1971, p. 145. This Fortune
analysis of the Nader influence includes a reference to Nader's
visit to a college where he was paid a lecture fee of $2,500 for
"denouncing America's big corporations in venomous language
. . . bringing (rousing and spontaneous) bursts of applause"
when he was asked when he planned to run for President.
8 . The Washington Post, Column of William
Raspberry, June 28, 1971.
9 . Jeffrey St. John, The Wall Street
Journal, May 21, 1971.
* . Italic emphasis added by Mr. Powell.
10 . Barron's National Business and Financial
Weekly, "The Total Break with America, The Fifth Annual Conference
of Socialist Scholars," Sept. 15, 1969.
11 . On many campuses freedom of speech
has been denied to all who express moderate or conservative viewpoints.
12 . It has been estimated that the evening
half-hour news programs of the networks reach daily some 50,000,000
13 . One illustration of the type of article
which should not go unanswered appeared in the popular "The
New York" of July 19, 1971. This was entitled "A Populist
Manifesto" by ultra liberal Jack Newfield -- who argued that
"the root need in our country is 'to redistribute wealth'."
14 . The recent "freeze" of
prices and wages may well be justified by the current inflationary
crisis. But if imposed as a permanent measure the enterprise system
will have sustained a near fatal blow.