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AN INTERESTING news item was recently broadcast on television in Europe, which tells us something about the way economic affairs are being viewed in influential circles.
Readers will remember flight MH17 of Malaysia Airlines which was shot down on April 18 last year over the eastern Ukraine, where a civil war is raging for the separation of the region from the Ukraine and perhaps its eventual incorporation into Russia. According to leaks emanating from the investigation into the tragedy, everything points to the guilty party being Russia, who allegedly supplied the Buk missile and its crew which caused the Boeing 777 with 298 people on board to crash.
This is, however, not about who shot the plane down. It is about the airline which flew over what was a dangerous battlefield at the time.
When Russian President Vladimir Putin forcibly annexed the Crimea in February 2014, the airspace above the peninsula was closed. This was still the case on April 18.
Some airlines had by that time already judged the region too dangerous and moved their flight paths; others – like Malaysia Airlines – did not. The carriers flying between Europe and east and southeast Asia had two course alternatives, namely to bypass the Crimea to the north (over the eastern Ukraine) or to the south (over the Black Sea).
The second alternative meant that the flight distance would increase by about 600km. Obviously, that makes a difference: more fuel is burned, more fuel has to be carried, which means less freight, which in turn means less profit.
And so, some airlines chose the dangerous route over eastern Ukraine. Apparently, there were numerous warnings which were not heeded by all.
MH17 paid the ultimate price for profit
To put it differently, the bottom line was so important to those making decisions that they closed their eyes, ears and minds to the warnings. It took the death of 298 innocent people (and the loss of an expensive aircraft!) to induce them to take the longer route.
This causes me to ask the question what the role of financial profit should be in any economy.
Please do not misunderstand me. I am not a socialist, and I do not see profit as a dirty word. Profit is to a large extent what makes the world go around.
If my company doesn't make profit, it cannot expand. It probably will go bankrupt after a while, in which case all employees will be joining the ranks of the jobless army sitting around, desperately trying to survive, contributing to crime and the dangerous instability in our society.
The question is whether profit is the only goal to chase.
I remember attending meetings where the central theme was to come up with new ways of making money. The basic approach was: “A lot of money is lying around in this or that community; we should rake some of it in to us.”
Nothing wrong with it; innovation is a great thing. But nobody said: “While we are bringing in some of the money, we can also do something for the people from whom we are making a profit.” The people did not figure at all. Just profit.
As the mentality of Malaysia Airlines (and other carriers) shows, this one-sided approach can, in extreme cases, lead to catastrophe. And if the moral side of the argument does not tickle your fancy, think of the expensive aircraft which went down, the millions paid out to relatives of the deceased, the damage to the company's brand name, and so on.
My point is that while chasing profit is fine and necessary, there are other things to think of as well. The most important of these is serving the community.
And please don't write me off as a naïve do-gooder. There are enough hard-headed reasons to think further than the length of your nose.
Yes, you can do well by doing good
A few years back the British news magazine The Economist had a lead article with the heading “Doing well by doing good”. Nobody can accuse The Economist of being soft in the head.
This is exactly what I am saying. If you serve your community – your clients, your consumers, however you want to call it – properly, it will also be good for your bottom line.
But you need to approach the matter with insight and intelligence.
Alas, if one looks at – for instance – the gigantic salaries and bonuses paid to top business people, one does not get the impression that many of them would agree with me. It always sticks like a fishbone in my throat when I see millionaires deciding that 100 or 1 000 employees will be laid off, while their own positions and riches are left untouched.
And this mentality knows no colour. Jacob Zuma is as guilty as any top white “bankster”.
Throughout the world, and not least in South Africa, a wave is building up against the rich. Do not underestimate it; it has the potential to destroy the capitalist system, as well as the rich and poor alike.
A while ago, I ended my column with a statement which I would now want to repeat: capitalism's biggest enemies are to be found in the ranks of the top capitalists.
* Leopold Scholtz is an independent political analyst who lives in Europe. Views expressed are his own.
