A Modern Corporation Reports

September 1, 1947

To our Stockholders:

Your corporation has always sought to be up-to-date, and to act in accordance with the precepts of the most forward-looking economists and statesmen. Your corporation seeks only service, and not profits. We are happy to report that in the last calendar year we have been of infinite service and have made no profits whatever.

Your corporation has of course kept in mind the importance of constantly boosting wages. Our workers must be paid enough to buy back the product we make, which consists mainly of nuts and bolts. We also wish to boost wages to increase the national purchasing power. In accordance with our understanding of the objectives of the CIO, we last year granted our workers an increase of 15 percent every month over the preceding month.

In January we made the mistake of announcing our first 15 percent increase without consulting the union leaders. We were promptly notified by the National Labor Relations Board that we had been guilty of an unfair labor practice in not having engaged in collective bargaining. We rectified this mistake in February. In our March negotiations, however, the union leaders called our attention to the fact that these voluntary raises on our part were undermining their position with the rank and file, who were beginning to ask whether they needed any high-salaried union leaders at all. The union leaders therefore suggested that the 15 percent increase ought to be granted every month only after they had demanded 30 percent, so that the wage increases each month could appear to be wrung from us. We agreed to this arrangement as the only one under which collective bargaining and a strong union organization could be preserved.

In accordance with the demands for “full employment” we have naturally sought every means by which to make more work. For this purpose we have hired inefficiency experts and specialists in unscientific management who are able through motion analysis to find slower and more complicated ways of doing things and who call attention to points at which labor-saving machinery can be got rid of. Through their expert services we are proud to announce that we succeeded in raising employment 37.2 percent last year with no increase in output whatever.

We have paid special attention to expanding our export sales by granting credits to foreign customers. Our company economist has pointed out to us that it is of no importance whether or not these loans are ever repaid, because they enormously increase our export sales. Moreover, he points out that it will be of particular advantage to the country if the loans are never repaid at all, because in return for our exports there will then be no imports to threaten our home industries.

Your corporation has issued a volume of bonds during the year which greatly exceeds the value of the corporation’s assets. We consider our bondholders, however, part of our corporate family. There is nothing to worry about, because as one big family we merely owe this debt to ourselves.

Your corporation has also contributed outstandingly to the fight against inflation. In accordance with the President’s request, we have constantly reduced our prices. As they are now far below production costs we feel confident that they must be fair. It is in the realm of prices, in fact, that your corporation has made a great contribution not only to prosperity but to economic science. Our company economist has long pointed out to us that if we constantly reduce prices we will constantly increase our volume of sales. We have found this to be so. We have finally found, in fact, that we dispose of the greatest volume of goods when we charge no price for them at all.

In this shining record of achievement, your corporation must report only one fly in the ointment. This, we regret to announce, is our last report. We are bankrupt and going out of business today.

Signed,

I. M. N. ADDLEPATE,

President