a modest proposal
Courtesy of Joshua M Brown
Jonathan Swift’s ‘A Modest Proposal’ carried the subhead “For Preventing the Children of Poor People in Ireland, from Being a Burden on Their Parents or Country, and for Making Them Beneficial to the Publick” and it represents the very highest form of sarcasm and satire. He offers a solution for mass poverty, with a completely straight face, that involves allowing people to eat their own children so as to avoid starvation and bringing more suffering mouths to feed into the world.
Swift wrote it to the Pope on behalf of his suffering countrymen in Ireland, to punctuate just how bad things were in as caustic and sardonic a manner possible. His intent was to demonstrate how ludicrous the problem had gotten and possibly to goad the titular spiritual head of the world into charitable action. Some historians suggest that Swift was mocking the solutions and schemes of other intellectuals at the time, who offered similarly outlandish and insensitive solutions without any sense of irony.
You can read it here in its entirety if you can find the time.
Anyway, what you’ll read below is not at all meant as satire. My modest proposal for Apple will likely be ignored by the Pope of Silicon Valley in his new circular Apple vatican. But I still think it’s worth mentioning.
Last night I said the following and recieved quite a range of feedback:
Just a few things to add:
First, this type of thing is not completely unheard of among companies that reach such an extraordinary pinnacle of profitability that they run out of productive, conventional things to do with their cash. There are plenty of charitable efforts spearheaded or primarily funded by corporations. I will concede, however, that most of the famous philanthropists throughout history did so with their private wealth, often as a consequence of having cashed out of their companies. Think Vanderbilt, Carnegie, Gates, Gould, Astor and Morgan for example. The Hershey Corporation offers a model for this sort of thing. When you visit Hershey, Pennsylvania, you cannot help but feel the myriad ways in which the company has acted as steward and benefactor for its community for like a hundred years. It’s been a resounding success.
Apple itself used to give away (or cheaply supply) its computers to schools all over America. It was good PR and it was also strategic – by getting kids accustomed to their products (and operating system), it could be said that they were creating Apple consumers for life. It didn’t necessarily work, thanks to the Windows juggernaut, but when Jobs returned to Apple in the late 1990’s, his first big breakthrough to reinvent the company were the iMacs – cheap, fun, colorful and bright little machines targeted toward high school and college users. ‘Member these?
Apple’s probably not going to do a quarter-trillion-dollar acquisition. Even with their manageable debt load, current plans to return shareholder cash in the form of dividends and buybacks and R&D efforts, it’s highly doubtful that the company is going to find a productive use for the entire mountain of cash that continues to pile up on its balance sheet, both in the US and abroad.
Another point – giving away a billion dollars a year in a thoughtful way and then managing the ongoing trust isn’t going to be easy. This will create more jobs and allow the company to work closely with local governments, universities and municipalities to see that it’s done righteously and intelligently.
Additionally, while it may be difficult to calculate in actual ROI terms, there is no doubt that a student helped to graduate or attain additional training and schooling thanks to Apple will never forget it. Apple could change the lives of millions of people who, I would speculate, would become Apple users and aficionados for life. It’s a long-term investment and I don’t pretend we can know what the exact payoff would be. It won’t be zero.
Would also note that no one is suggesting someone force anyone to do anything. This should be put to a vote within the company like any other strategic initiative. If it fails, it fails.
As to the uproar amongst shareholders about the corporation “giving away” their money – my response is let’s see what happens. There is a board of directors in place and if it were explained to them as a reinvestment in their users and potential customers, I don’t think the uproar would be quite as one-sidedly negative as my Twitter timeline might imply. I’m an Apple shareholder; I can’t be alone in thinking that there are big benefits to a company acting civically and soulfully.
The economic recovery in America has not been as kind to some regions and some communities as it has been to others. This is not Apple’s fault, it’s just an unfortunate side effect of capitalism, policy and the great arc of progress. The world isn’t fair. Historically, the spread between the haves and the have nots widens and tightens and governments haven’t ever really been able to control that. In fact, they can sometimes make things worse in their attempts to. I understand why libertarians would be content to end right there with that statement. All I’m suggesting is that when there are a lot of people struggling, it’s not the worst idea on earth to see if there’s a way to work on the problem.
Yes, I understand the argument that unintended consequences could arise. Perhaps Apple’s largesse will serve only to drive up tuition costs and create additional cost inflation for other students. I just don’t agree with this being the guaranteed result or accept it as inevitable. It’s okay if you’re certain of it, I’m not certain of anything. I do know that we have students burdened with over a trillion dollars in debt and college degrees have shown themselves to be extremely important in the modern economy.
Apple has become the most successful corporation in human history. It has an $800 billion market capitalization today and holds $261 billion in cash (not all of it unencumbered, but still). It is likely that a quarter from now, a year from now, etc, that this cash hoard will have grown even larger. I can think of no reason for the company to restrain from giving something back to the nation that spawned its incredible success story.
Without the rule of law, abundance of capital, physical infrastructure, university system, intellectual property rights and dynamic consumer culture we have here in America, something like Apple Inc could never have happened. What would be so terrible about this miraculous company reinvesting in the environment that enabled it all in the first place?
