MBA: The Cult of Robber Barons??

Some time back, Alternative Perspective had featured a posting "MBA Education is bad for Society/ Business... Students!!"

This posting is a continuation, though from a different angle.

Yoshi Tsurumi is a professor of international business at Baruch College, and had taught at Harvard Business School from 1972 to 1976, when President GW Bush was an MBA student there. Though much of the article is a criticism of Bush's economic policies, there are also significant observations about the MBA education

(Since Indian MBA is modelled on US MBA, his observations about the "American business education" are equally applicable to what is taught in the Indian B-Schools).

Some excerpts from his article "Hail to the Robber Baron":
http://www.tbrnews.org/Archives/a1514.htm

"Thirty years ago, President Bush was my student at Harvard Business School... In those days, Bush belonged to a minority of MBA students who were seriously disconnected from taking the moral and social responsibility for their actions.

Today, he would fit in comfortably with an overwhelming majority of business students and teachers whose role models are celebrated captains of piracy. Since the 1980s... America’s business education has also increasingly become contaminated by the robber baron culture of the pre-Great Depression era.

...Business education has also produced former Enron CEO Jeff Skilling and other MBAs behind the malfeasances of Tyco, HealthSouth, Haliburton, AIG, and WorldCom. Many executives of corporate America who hold MBAs have also been engaged in the unethical acts of raiding their corporate treasuries at the expense of employees and stockholders. ...a multitude of CEOs in corporate America give themselves obscenely large bonuses that have little to do with their performance. In 1980, the CEOs of Fortune 500 large corporations received, on average, 70 times larger annual compensations than their average employees... (now) comparable CEOs have come to give themselves 600 to 1,000 times larger annual compensations than their rank-and-file employees whose pay has stagnated....

...Meanwhile, American economics study has increasingly become a pseudoscience of mathematical formula manipulation that is devoid of humanity. This economics has conquered America’s business education and become fused with the robber baron culture of greed supremacy. American MBAs are taught to treat ordinary employees as disposable costs and to swallow uncritically the gospel that corporations exist only to reward abstract stockholders. MBAs are taught the pretend-science of manipulating accounting, finance, employees, customers, and stock prices. Financial games and hostile takeovers of competitors are taught to accomplish corporations’ sole objective — to make money and manipulate stock prices.

...To justify the robber baron culture, America’s business educators and economists falsely cite their demigod of laissez-faire market economics, Adam Smith. Little do they know that Adam Smith in fact scathingly castigated... business collusion and unfair taxes,... exploitations of labor and communities, and robber barons’ hubris. Nowhere in his 900-page book, The Wealth of Nations, does Smith even imply that those who knowingly harm others and society in their pursuit of personal greed also benefit their society. He rejects the notion that a corporation exists to make money without ethical constraints."