May 13, 2024 • 29 mins
Dr. Dan Sutter, of the Manuel Johnson Center for Political Economy, hosts EconVersations, a program that explores the role of free markets in promoting prosperity through conversations with Manuel Johnson Center faculty and guests. In this episode, Dr. Sutter interviews Dr. Allen Mendenhall, and Free Enterprise Scholars, Mackenzie Ensley, and Ethan Girona, as they discuss Free Enterprise Scholars.
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(00:00):
The opinions expressed on
this programrepresent the viewpoints
of individual authorsor contributors,
and do not necessarily reflectthose of Troy University.
I mean,this is in conversations,
a joint production of TroyTrojan Vision and the manual H.
Johnson centerfor Political Economy.
(00:20):
Now, here'syour host, doctor Dan Sutter.
Hello, and welcometo the Conversations.
I'm your host, Doctor Deans,out of the Johnson Center
for Political Economyat Troy University.
Once upon a time, businessesdid not take stances
on controversial politicaland cultural issues of the day.
(00:40):
Instead,they stuck to selling goods
and servicesand tried to avoid alienating
potential customersor employees.
All of this has changedwith the arrival
of what has been termed wallcapitalism.
Is it possible
for the business worldto rediscover
the traditional virtuesof commerce
that enable cooperationamong the diverse people
without forcing anyone's
values on others,and which helped create
(01:03):
the prosperityof contemporary America?
The Johnson Centerhas been trying to do this
through our Free EnterpriseScholars program.
How has it been going?
Well, that's what we'll betalking about on today's show.
And help me with this.
I'm joined by doctor alum,and I'm the Grady Rogier
professor and executive directorof the Johnson Center
and two of Troy University'smost outstanding students,
(01:25):
who are proud to claim as free
enterprise scholars MackenzieAnsley and Ethan Cherono.
Well,welcome to your conversations.
And so let's start with Ethan and Mackenzie.
Tell us a little bitabout yourselves,
your background,how you got to Troy University
and what you're studying.
Yes, sir.
So, my name is Ethan.
Jonah.
I'm a seniormajoring in economics
(01:46):
and minoringin American politics.
Mackenzie and I are actuallyfrom the same hometown.
Congratulated.
she graduated with my youngerbrother,
class few, a few below me.
And, on campus.
I'm a Supreme Court
justice for the, SGAStudent Government Association.
I'm involvedwith the free enterprise
Scholars programand outside of campus,
(02:06):
currently,public affairs and policy
internfor the state finance director.
And I've done a community,
community indications internshipwith Governor Colby's office
and some other internships hereand there.
And I can also addthat you were recently selected
as, the outstanding economicsmajor for 2024.
So, Mackenzie,tell us a little about yourself.
(02:27):
Yeah.
So my name is McKinsey Anthony,
and I am from Smith Station,Alabama.
Seven's Ethan, I'ma sophomore global business
major with a concentrationin risk management insurance.
I work on campusat the tutoring center
as an economicsand writing tutor.
And on campus,I also serve on the Supreme
Court and SGA and off campus.
(02:50):
I am really involved at a localsummer camp that I work at.
Awesome, great.
So, tellus a little bit about the,
our FreeEnterprise Scholars program.
Tell people when we got startedand what we're trying to do.
And the big picture here.
Well, Dan, as you remember,well, during the summer of 2022,
(03:11):
we both read vehicle
Almost Always WokeInk and thought
this would bea really interesting text around
whichto build a complete program.
And we realized thata lot of young people and others
were considering thingslike profits to be negative,
and we thought,
we need to really tell the storyabout the positive
(03:33):
things that businesses doto show young
people and society writ largethat profits are, in fact, good,
that firms can't hire,people, cannot provide benefits,
cannot contribute tothe community, cannot contribute
to philanthropywithout earning profits.
And so we developed this programand we launched it
in August 2022.
(03:55):
And the rest is history.
And Mackenzie and Ethan, it'sone of our first,
free enterprise scholars.
So tell us a little bitabout your thoughts
coming into this program.
Where did you thinkwhen you saw the,
the, email that you received and describing this or inviting
you to participate?
so I hadtaken kind of a gap year, did
some of my, work for a,
(04:17):
the spring semester leading upto the, 2022 fall year.
I did an internshipwith the Alabama
State Legislatureand getting back onto campus.
I really wanted to get involved
because I hadn't had muchopportunity.
My freshman yearbecause of Covid.
and, Doctor Mendenhallsent out this email,
to the business school saying,hey, we have this new program.
So it's kind of, about, traditional business practices
(04:41):
and mixingin that political elements.
I was really interested andthen jumped on it right away.
And here we are today.
Yeah, it's about the same storyfor me, too.
But I was an incoming freshmanwhen I started the program,
and I knew I wantedto get involved in campus
and doing something.
And when I read the email,
I thought this program sounded
(05:01):
like something that I'd bereally interested in.
So I definitely applied.
Awesome, awesome.
So you've both been greatin the program.
So, Allan, tell us a little bit more.
You mentioned the
some of these traditional
virtues of, of commerce,but as we go beyond that,
what are some of these, virtuesthat we're trying to,
just share with our students?
(05:21):
Well, in general,
commerce and exchange havea civilizing effect on people.
They minimize irrationaland violent behavior,
and they encourage or facilitatecooperation and exchange.
And that is so importantin a society
that is politically fractured.
I actually think that businessas historically practiced
(05:44):
could do a lot to
heal someof the wounds in society
and to to, to work towardsovercoming
some of the fracturein our political climate
right nowwhere we are so divided,
businessis something that can unite us.
And so we certainly had onespeaker, Chuck salvo,
(06:07):
who did a great job bringing,
you know,we talk about some of the work
that he does, helping, in someof these fractured workplaces.
But, you know, so
Ethan and Mackenzie, what, what do you see
as some of these,virtues of capitalism?
Are we, convincing youthat, you know,
for instance, businessesalways are making the world
a better place simplybecause consumers
(06:28):
want to buy their products,and, and,
you know,workers want to work there.
So while what do you guys think?
I'd sayjust as an economics students.
One the first thing you learnis incentives really do matter
and it motivates people's,actions.
And in today'spolitical context,
people are always worriedabout stakeholder capitalism and
and not so much
about shareholder capitalism,which takes into consideration
(06:51):
how businesses do have to care
about their customers,their suppliers,
the people that are competing
against them,the people that they work with,
they have to take all these
into consideration,consider their incentives
and why they do want to workwith this business.
stakeholder capitalism,kind of I would say,
is the same thing,
but they try to make it sounda little bit more fancy and
(07:14):
throw more political elementsinto it.
When, traditional businesspractices are certainly civil
and, and promote, cooperationamongst individuals.
Yeah.
I mean,
you have to treat
your customers with respect
because they don'thave to buy your product.
And so and necessarily you
you have to treat customersand employees with respect
or they will not do businesswith you.
(07:35):
So, Mackenzie,what have you learned
some of these lessons about, cooperation?
Oh, we've talked a lot
about business,the modes of business,
the classicaltheories of business.
And I would definitely saythat coming into this program,
I had never thought about reallyanything towards business.
I just hadn'tgiven it a second thought.
(07:56):
And I guess
freely talking about the risksinvolved with business,
investing, starting a business,working for a business.
I would saythat I've never really thought
about that before,
but it was really interesting to
look at itfrom a different perspective
and to think about itin terms of scarce resources.
If someone is startinga business,
they're doing, their dutyto society
(08:17):
by providing a good or service,
and people couldn'tget otherwise.
And there are trade offs.
So they could have gotten a jobsomewhere else.
But instead they're choosingto serve the customers
by giving them what they want.
And that in and of itselfis ethical and good.
And that's whywe should protect business.
And, you know, many times
in small towns,I mean, they're helping to
make that community strongerby hiring people
(08:38):
or giving better options for,for shopping in their,
in their community.
So now, two of the topicsthat we've spoken about a lot
over the last couple of years
are ESG and, and then, corporate stakeholder ism.
And I think we mentionedstakeholders, a little bit.
But, Alan, tell us a little bitabout these
two important issues,because you've also
ESG has been a topic
(08:59):
for some of our researchthat that we've been working on.
So it's a it'san important topic
and onethat we've tried to convey here
and, and cover it in the FreeEnterprise Scholars Program.
Well, ESGis a wide ranging subject,
but to put it as simplisticallyas possible, ESG is an acronym
that stands for Environmental,social and governance,
(09:21):
and it refers particularly to
the investmentand financial services space
and to the practiceof accounting for,
accounting for non-financialstandards and factors
when firmsallocate capital or assess risk.
So stakeholderism is just one element of ESG.
(09:42):
Even you made an excellent pointearlier
talking about stakeholder holderism, which presumes that under
the traditional shareholdermodel of corporate governance,
firms are not alreadyconsidering
the interestsand concerns of clients,
customers, employees, suppliers,
(10:02):
when in factevery successful business
under the traditionalshareholder model has to account
for the interestsof all those constituencies
if it wants to remainsuccessful as a firm.
And so I believe thatthe stakeholder
model is sort of predicatedon a false assumption.
And again,this is just one element of ESG.
(10:24):
There are numerous other,factors to consider,
whether you're looking underthe E or the S prong.
And in general, ESG pushescorporations
into controversial politicsrather than
freeing them upto focus on their business
and doing what businessesneed to do to succeed.
In the financial partor in financial markets, really
(10:48):
sort of works, almost use,
weaponize accessto finance, which,
all businesses need becauseall business is run on credit.
They can't run a businesswithout banking services.
And and really trying to usethat as a leverage
over businesses
to sort of forcethem to advance certain issues.
That's right.
And I do not believe
ESG could succeed if it werejust a purely private endeavor.
(11:12):
It's because so much of ESGinvesting takes place
with pension money,with, with, government bonds,
with sovereign wealth funds,in short, with government money
that it's able to even haveany sort of traction whatsoever.
Absentthat government investment,
I don't think ESG can competeagainst the market.
(11:33):
And in fact,we see study after study now
coming from the private sector,coming
from financial institutions,showing that ESG, actually
ESG weightedportfolios, ESG index funds
actually underperform the marketand it just makes sense
because if, the market is about diversifying
your investmentsto mitigate risk, well,
(11:55):
if you narrow the rangeof possible investments,
then just mathematically,it's impossible
to compete against the marketbecause you have,
fewer industriesand fields in which to invest.
And so,
Mackenzie andEthan, what are some of your,
things that you guyshave learned from our program
about these these topics of ESGand stakeholder ism?
(12:20):
We can see,
well.
coming into this program,I think the biggest thing
that we've talked to a lot abouthas definitely been ESG
in terms of, why?
In terms of fiduciary duty,
I would say that'sprobably been the biggest thing.
(12:41):
fiduciary duty means thatif you have control of people's
money, it's in your best.
It's in
you have to do with their moneywhat's in their best interests.
So I would say thatthinking about it
in terms of corporate officershaving control
of millions of dollarsof their investors money,
that it is their duty to investin, in ways
that maximize theirreturn on investment, not on,
(13:06):
movements or,
I, I can't think of the word
initiativesthat promote certain ideologies
or other ways of thinking,because at the end of the day,
their main job should be tomaximize shareholder investment,
not to come out their ideasor beliefs.
(13:29):
And by doing that, they'reviolating their fiduciary duty.
And that's notwhat business is for.
And it's
not supposed to take otherpeople's money and then use it
in ways
that they haven't explicitlyauthorized you to, to use that.
Ethan.
I kind of piggybacking offwhat Mackenzie said,
I think there's no argumentthat people,
(13:51):
want to make money, that youlike more money than less money.
And when you include this
environmental, social governanceaspect, you're allowing
these corporate managers or,or firm investors to take,
take people's moneyand put them into projects or,
initiativesthat are more controversial.
so I think,
(14:13):
allowing people to
be confidentthat their money is being spent
in ways or invested in waysthat will secure higher profits
and not necessarilysocial causes.
is a big part of what we'vetalked about in the program.
so ESG has beena big part of the,
the program that we talked aboutand, stakeholder
capitalism,like documenting, has mentioned.
(14:33):
And, Dan,
if I may, there are othervehicles for investors who wish
to put their money towardssocial or environmental causes,
and they are charity.They are philanthropy.
You don't have to put your moneyin an index fund
in order to try to makethe world a better place,
according to your vision of whatthat ought to be.
And and and to be clear,you know,
(14:56):
as investors are freeto invest their money
however they want and absolutelyhave strong values.
And they think thattheir business
or their financial investmentsshould be consistent
with those valuesand not invest in things
that they don't personally thinkmake the world a better place.
They're free to use their moneyhowever they want,
and at some level,you could expect to see
financial markets aggregate,you know, offer products
(15:19):
that would sort of appealto such investors.
But, you know, the issues that
that we are dealing with withESG are far more complicated.
And with that than that,it's like
is of usingsome other people's money,
without explicit consent.
And like,as you said, Mackenzie,
they consider this issue of, fiduciary duty and
(15:40):
and so, yeah, it's importantto, to understand
exactly what's going on withsome of these, these issues.
So, Alan, tell us a little bitabout some of the different
speakers and some of the wayswe've gone about,
you know, advancing both these,these ideas.
Sure.
Some of our recent speakershave been, Alexandra Hudson,
(16:01):
who spoke about,
the importance of civilityto society writ large.
Andy Alabaster of the HeritageFoundation, one of,
Troy University's distinguishedalumni, Jay Nordlinger
from the National ReviewInstitute.
Ben Johnson, a professorfrom the University of Florida,
spoke about corporate law andissues related to corporations.
(16:22):
Richard Adler Cominco,who is now leading
the University of Wisconsin
to go, joined Scotton the School of Economic,
Thought and Research.what is it?
The School of EconomicThought and Leadership
at Arizona State University.
Anson Friedrichs,the president of Stripe Asset
Management, AndyPozner, the former, CEO of Ski
(16:42):
Restaurants, ScottShepherd of the National Center
for Public Policy Research.
These are just a few examples ofthe people who came and spoke.
But we also had,
generous organizationsdonate books for us to read.
For example,the American Enterprise
Institute, donated copies
of Morality of Markets Argumentsfor the Free Market System,
which was editedby Yuval of then,
(17:03):
the Cato Institute, donated copies of the case
for Shareholder Capitalism,which we read.
And then we've read books by, Jim Hardison,
seven Deadly EconomicsSins and Honorable Business.
These are really excellentbooks, and I know the students
worked really hard,to read week in and week out
because we either
(17:24):
we either did a reading group,which you directed, of course,
or we had a guest lecturercome in every single week,
with maybe the exceptionof spring
break in the spring and maybe, Thanksgiving break in the fall.
So this is a rigorous program,and it's a very deep commitment
that the studentsmake to the program.
And, I'm just excited about howwell it's gone and how much
(17:47):
the students have excelled.
I've seen them grow.
I've watched them learn.
that has been an excitingexperience for me personally.
Given have also been able to,
as you seefrom some of these pictures,
have an opportunity
to interactwith some of these speakers and
here on a one on one basis, or,
not just in our discussion,but,
(18:08):
you know, outside of that,at a dinner or whatever.
So and I think thoseare really important things
to add to the studentlearning experience as well.
Absolutely.
I think getting to knowthese speakers on a personal,
one on one basis leadsto a very interesting learning
experience, experiences,but also to opportunities.
I know we've had,
(18:28):
at least one student gainan important internship
through, interactionswith a guest lecturer.
So, Ethan,and what have been some of
the highlightsthat the uses of,
our speakers that we've had,coming in to talk to the group.
I've really enjoyed being ableto sit down with these speakers,
listen to them,
one of them, Ben Johnson,talking about, corporate,
(18:51):
activitiesand things like that,
and then going to dinnerwith him afterwards
and just being ableto pick his brain on,
I mean, the classeshe's teaching.
And I believe I would say that,things of that nature
and to just like the book clubin general,
it's kind of
when we first found outthat we were going to be reading
books is a little daunting,adding another two books
onto the, schedule of classesand things of that nature.
(19:14):
But they've actually beenreally interesting books.
And it's easy.
It's kind of,
a page flip, not necessarilythriller or anything,
but it's still interestingbeing able to read these books
and kind of compare themto the real world
and thingsthat I'm seeing at work as well.
Yeah, I think that
both of those, books
that you mentioned, Alan,
that we covered this lastsemester, were very well done.
(19:36):
And I commend, AEI and Cato forfor putting those out.
So because would have beensome of your,
highlights in the area of thespeakers, that, that stand out.
Yeah.
So, her name's escapes me, butshe wrote The Soul of Civility.
That's AlexandraHudson. Let's see. Hudson.
Hudson was very interesting.
I think she's beenmy favorite speaker
(19:56):
that we posted so far,
just because I thoughtwe had a really good
in-depth conversationabout what being civil means.
And we sat down at dinnerwith her in the conference room,
and that was justa really great experience.
And she
we have copies of her book,and I have read some of it,
and I thoughtit was really interesting.
but I would also just say that
(20:17):
the biggest highlight for me
was probably likefinding community
in the business school
and specifically in the econ
department, because I'mnot an economics major,
but being ableto build connections
with economics professors
and other econ students has beena really good experience.
And just getting more context
of my business educationfrom all the books we've read,
I would say thatit's been really helpful
(20:38):
going through
my introductory business classes
and having a greaterunderstanding of what all
we're talking about in class.
So this program is definitelyhelped me in that aspect.
And so you think it's added
some things beyond anythingyou're getting in classes? Yes.
And Ethan,you I see what you said.
it's it's been two
principal classesand kind of go into it
(20:59):
knowingmore than the other students.
Do you hear about these, shareholder capitalism concepts?
And some of the other studentsare struggling to grasp it.
We're meeting weekly
and discussing these thingswith one another
and kind of picking each other'sbrain, picking your,
YouTubes brain about the topicsand conversations as well.
So I think overall it'sbeen a beneficial, club to be
(21:20):
a part of
it. And so we've been
talking recently about,you know,
perhaps expanding our programnext year to,
hey, guess after the studentsgo through the a reading group
to perhaps try and get theminvolved in research
on these important topicsbecause like,
that's another,I think, important thing
that that we as a universityshould be trying to do is as,
(21:41):
introduce,our students to, to research,
because that's what we doas professors.
And it's what you know,got many of us
into, our career because we,we love doing research.
And, and so I think it's
really important toto try and introduce
students to do researchand then allow them to also
not just read about,but actually do something
(22:02):
about some of these issuesof the day.
Right?
That's exactly right.
And the Johnson Centerhas been inundated
by requests for research becausethis program is so unique.
It is on the map, so to speak.
People are noticingwhat we're doing,
and we're working in a spacein which there happens
to be a high demandfor research.
(22:24):
So allowing the studentswho go through the program to,
as it were,a graduate into a research
position is helpfulnot just for them
and that
they are
now equipped to do researchand they actually get
to do research.
But also, it's helpfulto all the people out there
seeking more information,more data
(22:46):
about, for example, ESG or about the shareholder versus
the stakeholder modelof corporate governance.
And thanks to the generousdonations from private donors,
we're able to take this programto the next level.
the Bradley Foundationhas been particularly generous.
We have, a new, donorand the ACC Foundation,
(23:06):
the acting Institutehas been contributing.
I mentioned
AEI and the Cato Instituteproviding books for the program.
And then locally herewe have Alpha,
which has providedsome funding for the program,
and then just numerousprivate donors
just giving one small gifthere, one small gift
there, has enabled usto grow the program
to fund the students, to providebooks for the students,
(23:28):
to give them scholarship money,
for participatingin the program.
And now to take itto the next level
where we will havenot just a new,
a new, core of studentsgoing through the program
as it has been operatingat the last two years.
But, have new positionsin which we have the people
who have gonethrough the program
(23:49):
start doing research and start,I'll start really
taking their learning andunderstanding to the next level.
Well, in our this year,of free enterprise, scholars
have worked on some op edsto discuss something.
So, you know, Ethan,you were working on an op ed
related to, unions, which seemsparticularly timely.
(24:10):
Today.
We are in Alabama since therethere's a unionization drive
at the, Mercedes plant outside of Tuscaloosa.
So tell us a little bit aboutwhat you've been, right about.
so that's primarilythe reason I did decide to
write this paper is workingin Montgomery.
It's kind of been a hot topic.
We've seen the governorput out a press
release about labor unions.
(24:32):
the commerce secretary,the leaders of the House
and Senate have, put up things.
So I thought it'd be interestingto kind of dive
into this topic and
and figure out
the historical context of laborunions, how at one point
they were, in the benefitof the workers because we didn't
have these laws or regulationsin place, to protect workers.
But over time, we have over180 federal regulations,
(24:56):
regulating governing workplaceactivities,
relationship between employers,employees, and standard
health and safety,guidelines for workplaces.
So I think over time they havebeen beneficial for workers.
But in today's current contextand political climate,
I don't really seethe need for labor unions.
(25:17):
I think they get more in the wayand try to uplift a few while
taking away jobs for some ofthe ones that really do need it.
Some of the younger,
people, people that do not havethe skill set necessary.
so I thought it wasreally interesting.
I, attended a, colloquiumin Vermont
last summer,and we read Milton and Rose
Friedman'sbook, Free to Choose.
(25:40):
And he talked a lotabout labor unions
and how they, they upliftsome of the few
in the community,but take away a lot from others.
So I just
I like learning moreabout labor unions and kind of
putting my perspectiveand spin on it,
why they're not necessarilyneeded in today's society.
And and Mackenzie,you were wrong about it.
So you made it to Cuba.
(26:00):
So tell us a little about your
trip to Cuba and what you sawabout socialism and socialism
failures up close and personal.
Yeah.
So I had the opportunityto study
abroad in Cuba last December,and it was a great experience.
But one of my biggesttakeaways from that
was that their economic system
and their government has failedthem.
life in Cuba is very differentthan it is here.
(26:22):
There are no public amenities.
there are people everywherein worse
poverty than I've ever seenin this country.
So I think that
the socialist system in Cubareally contributes to that.
They don't support businesses,they don't support innovation
or entrepreneurship.And it shows.
so that's what I wrote about.
(26:44):
and talking about thelacking of Cuba and its economy
and how its citizenssuffer as a result.
And I mean, lots of,college age students have
a high opinion of socialism,so perhaps they should go.
I mean, Cuba's only 90 miles offthe coast of Florida, and so
perhaps they could go see,how how socialism work
(27:06):
is working out in in personthere, right, absolutely.
And so,
Alan,tell us a little bit about,
you know, I guess
it was touch a little bitwhat we wanted going forward.
But you know what, what do you see
in, in terms of the futurefor our program here
and what might be the doingover the next year or so?
Well, I think we are lookingat hosting
(27:26):
an eventregarding ESG in the fall,
and we will be focusinga lot more on research.
I know you and Iare both working together
on articles regarding ESG.
I've got a special issue of theAlabama Lawyer, which is the
magazine of the StateBar publication
that's coming outon, on, specifically ESG.
(27:47):
It's a corporate law issue,but we're focusing on ESG.
And I know, we are going to bebringing together researchers
from other institutions, bothThinktanks and universities,
to start coordinating, and producing more research.
And, of course, our studentsare going to be a central part
of this experience as well,which will be exciting.
Yeah.
And I really look forward to
(28:08):
bringing some new studentsinto the program and continuing
to, to work with, some of our university's
most outstanding,undergraduates.
So, again, thank you. McKenzie.
And thank you, Ethan,
for participating our programand for coming on this, show.
And thank you allfor joining us.
Join us again next timefor another conversation.
(28:33):
This has been conversations,
a joint production of TroyTurgeon Vision and the Manuel H.
Johnson Center for PoliticalEconomy at four University.
(29:12):
So, Dan,you really just want to shoot
a promo on camera twowith everybody in the shot?
if you wanted me,
I was goingto do a little promo,
but you guys can get upif you want, or they'll.
They'll probably be ableto just zoom in on me
and talk to me there.
Be I can.
any one. Thing.
All right.
(30:04):
I think I got this figured out.
Stand by.
(30:28):
Is it possible to reclaim
the traditional virtues ofcommerce for American business,
or our business and finance now
to be employedas tools of social engineering?
I'm Doctor DanSnyder of the Johnson Center
for Political Economyat Troy University.
Join meon the next conversations
when we'll be talkingabout our free
enterprise Scholars program.
The opinions expressed on
this programrepresent the viewpoints
of individual authorsor contributors,
and do not necessarily reflectthose of Troy University.
I mean,this is in conversations,
a joint production of TroyTrojan Vision and the manual H.
Johnson centerfor Political Economy.
(00:20):
Now, here'syour host, doctor Dan Sutter.
Hello, and welcometo the Conversations.
I'm your host, Doctor Deans,out of the Johnson Center
for Political Economyat Troy University.
Once upon a time, businessesdid not take stances
on controversial politicaland cultural issues of the day.
(00:40):
Instead,they stuck to selling goods
and servicesand tried to avoid alienating
potential customersor employees.
All of this has changedwith the arrival
of what has been termed wallcapitalism.
Is it possible
for the business worldto rediscover
the traditional virtuesof commerce
that enable cooperationamong the diverse people
without forcing anyone's
values on others,and which helped create
(01:03):
the prosperityof contemporary America?
The Johnson Centerhas been trying to do this
through our Free EnterpriseScholars program.
How has it been going?
Well, that's what we'll betalking about on today's show.
And help me with this.
I'm joined by doctor alum,and I'm the Grady Rogier
professor and executive directorof the Johnson Center
and two of Troy University'smost outstanding students,
(01:25):
who are proud to claim as free
enterprise scholars MackenzieAnsley and Ethan Cherono.
Well,welcome to your conversations.
And so let's start with Ethan and Mackenzie.
Tell us a little bitabout yourselves,
your background,how you got to Troy University
and what you're studying.
Yes, sir.
So, my name is Ethan.
Jonah.
I'm a seniormajoring in economics
(01:46):
and minoringin American politics.
Mackenzie and I are actuallyfrom the same hometown.
Congratulated.
she graduated with my youngerbrother,
class few, a few below me.
And, on campus.
I'm a Supreme Court
justice for the, SGAStudent Government Association.
I'm involvedwith the free enterprise
Scholars programand outside of campus,
(02:06):
currently,public affairs and policy
internfor the state finance director.
And I've done a community,
community indications internshipwith Governor Colby's office
and some other internships hereand there.
And I can also addthat you were recently selected
as, the outstanding economicsmajor for 2024.
So, Mackenzie,tell us a little about yourself.
(02:27):
Yeah.
So my name is McKinsey Anthony,
and I am from Smith Station,Alabama.
Seven's Ethan, I'ma sophomore global business
major with a concentrationin risk management insurance.
I work on campusat the tutoring center
as an economicsand writing tutor.
And on campus,I also serve on the Supreme
Court and SGA and off campus.
(02:50):
I am really involved at a localsummer camp that I work at.
Awesome, great.
So, tellus a little bit about the,
our FreeEnterprise Scholars program.
Tell people when we got startedand what we're trying to do.
And the big picture here.
Well, Dan, as you remember,well, during the summer of 2022,
(03:11):
we both read vehicle
Almost Always WokeInk and thought
this would bea really interesting text around
whichto build a complete program.
And we realized thata lot of young people and others
were considering thingslike profits to be negative,
and we thought,
we need to really tell the storyabout the positive
(03:33):
things that businesses doto show young
people and society writ largethat profits are, in fact, good,
that firms can't hire,people, cannot provide benefits,
cannot contribute tothe community, cannot contribute
to philanthropywithout earning profits.
And so we developed this programand we launched it
in August 2022.
(03:55):
And the rest is history.
And Mackenzie and Ethan, it'sone of our first,
free enterprise scholars.
So tell us a little bitabout your thoughts
coming into this program.
Where did you thinkwhen you saw the,
the, email that you received and describing this or inviting
you to participate?
so I hadtaken kind of a gap year, did
some of my, work for a,
(04:17):
the spring semester leading upto the, 2022 fall year.
I did an internshipwith the Alabama
State Legislatureand getting back onto campus.
I really wanted to get involved
because I hadn't had muchopportunity.
My freshman yearbecause of Covid.
and, Doctor Mendenhallsent out this email,
to the business school saying,hey, we have this new program.
So it's kind of, about, traditional business practices
(04:41):
and mixingin that political elements.
I was really interested andthen jumped on it right away.
And here we are today.
Yeah, it's about the same storyfor me, too.
But I was an incoming freshmanwhen I started the program,
and I knew I wantedto get involved in campus
and doing something.
And when I read the email,
I thought this program sounded
(05:01):
like something that I'd bereally interested in.
So I definitely applied.
Awesome, awesome.
So you've both been greatin the program.
So, Allan, tell us a little bit more.
You mentioned the
some of these traditional
virtues of, of commerce,but as we go beyond that,
what are some of these, virtuesthat we're trying to,
just share with our students?
(05:21):
Well, in general,
commerce and exchange havea civilizing effect on people.
They minimize irrationaland violent behavior,
and they encourage or facilitatecooperation and exchange.
And that is so importantin a society
that is politically fractured.
I actually think that businessas historically practiced
(05:44):
could do a lot to
heal someof the wounds in society
and to to, to work towardsovercoming
some of the fracturein our political climate
right nowwhere we are so divided,
businessis something that can unite us.
And so we certainly had onespeaker, Chuck salvo,
(06:07):
who did a great job bringing,
you know,we talk about some of the work
that he does, helping, in someof these fractured workplaces.
But, you know, so
Ethan and Mackenzie, what, what do you see
as some of these,virtues of capitalism?
Are we, convincing youthat, you know,
for instance, businessesalways are making the world
a better place simplybecause consumers
(06:28):
want to buy their products,and, and,
you know,workers want to work there.
So while what do you guys think?
I'd sayjust as an economics students.
One the first thing you learnis incentives really do matter
and it motivates people's,actions.
And in today'spolitical context,
people are always worriedabout stakeholder capitalism and
and not so much
about shareholder capitalism,which takes into consideration
(06:51):
how businesses do have to care
about their customers,their suppliers,
the people that are competing
against them,the people that they work with,
they have to take all these
into consideration,consider their incentives
and why they do want to workwith this business.
stakeholder capitalism,kind of I would say,
is the same thing,
but they try to make it sounda little bit more fancy and
(07:14):
throw more political elementsinto it.
When, traditional businesspractices are certainly civil
and, and promote, cooperationamongst individuals.
Yeah.
I mean,
you have to treat
your customers with respect
because they don'thave to buy your product.
And so and necessarily you
you have to treat customersand employees with respect
or they will not do businesswith you.
(07:35):
So, Mackenzie,what have you learned
some of these lessons about, cooperation?
Oh, we've talked a lot
about business,the modes of business,
the classicaltheories of business.
And I would definitely saythat coming into this program,
I had never thought about reallyanything towards business.
I just hadn'tgiven it a second thought.
(07:56):
And I guess
freely talking about the risksinvolved with business,
investing, starting a business,working for a business.
I would saythat I've never really thought
about that before,
but it was really interesting to
look at itfrom a different perspective
and to think about itin terms of scarce resources.
If someone is startinga business,
they're doing, their dutyto society
(08:17):
by providing a good or service,
and people couldn'tget otherwise.
And there are trade offs.
So they could have gotten a jobsomewhere else.
But instead they're choosingto serve the customers
by giving them what they want.
And that in and of itselfis ethical and good.
And that's whywe should protect business.
And, you know, many times
in small towns,I mean, they're helping to
make that community strongerby hiring people
(08:38):
or giving better options for,for shopping in their,
in their community.
So now, two of the topicsthat we've spoken about a lot
over the last couple of years
are ESG and, and then, corporate stakeholder ism.
And I think we mentionedstakeholders, a little bit.
But, Alan, tell us a little bitabout these
two important issues,because you've also
ESG has been a topic
(08:59):
for some of our researchthat that we've been working on.
So it's a it'san important topic
and onethat we've tried to convey here
and, and cover it in the FreeEnterprise Scholars Program.
Well, ESGis a wide ranging subject,
but to put it as simplisticallyas possible, ESG is an acronym
that stands for Environmental,social and governance,
(09:21):
and it refers particularly to
the investmentand financial services space
and to the practiceof accounting for,
accounting for non-financialstandards and factors
when firmsallocate capital or assess risk.
So stakeholderism is just one element of ESG.
(09:42):
Even you made an excellent pointearlier
talking about stakeholder holderism, which presumes that under
the traditional shareholdermodel of corporate governance,
firms are not alreadyconsidering
the interestsand concerns of clients,
customers, employees, suppliers,
(10:02):
when in factevery successful business
under the traditionalshareholder model has to account
for the interestsof all those constituencies
if it wants to remainsuccessful as a firm.
And so I believe thatthe stakeholder
model is sort of predicatedon a false assumption.
And again,this is just one element of ESG.
(10:24):
There are numerous other,factors to consider,
whether you're looking underthe E or the S prong.
And in general, ESG pushescorporations
into controversial politicsrather than
freeing them upto focus on their business
and doing what businessesneed to do to succeed.
In the financial partor in financial markets, really
(10:48):
sort of works, almost use,
weaponize accessto finance, which,
all businesses need becauseall business is run on credit.
They can't run a businesswithout banking services.
And and really trying to usethat as a leverage
over businesses
to sort of forcethem to advance certain issues.
That's right.
And I do not believe
ESG could succeed if it werejust a purely private endeavor.
(11:12):
It's because so much of ESGinvesting takes place
with pension money,with, with, government bonds,
with sovereign wealth funds,in short, with government money
that it's able to even haveany sort of traction whatsoever.
Absentthat government investment,
I don't think ESG can competeagainst the market.
(11:33):
And in fact,we see study after study now
coming from the private sector,coming
from financial institutions,showing that ESG, actually
ESG weightedportfolios, ESG index funds
actually underperform the marketand it just makes sense
because if, the market is about diversifying
your investmentsto mitigate risk, well,
(11:55):
if you narrow the rangeof possible investments,
then just mathematically,it's impossible
to compete against the marketbecause you have,
fewer industriesand fields in which to invest.
And so,
Mackenzie andEthan, what are some of your,
things that you guyshave learned from our program
about these these topics of ESGand stakeholder ism?
(12:20):
We can see,
well.
coming into this program,I think the biggest thing
that we've talked to a lot abouthas definitely been ESG
in terms of, why?
In terms of fiduciary duty,
I would say that'sprobably been the biggest thing.
(12:41):
fiduciary duty means thatif you have control of people's
money, it's in your best.
It's in
you have to do with their moneywhat's in their best interests.
So I would say thatthinking about it
in terms of corporate officershaving control
of millions of dollarsof their investors money,
that it is their duty to investin, in ways
that maximize theirreturn on investment, not on,
(13:06):
movements or,
I, I can't think of the word
initiativesthat promote certain ideologies
or other ways of thinking,because at the end of the day,
their main job should be tomaximize shareholder investment,
not to come out their ideasor beliefs.
(13:29):
And by doing that, they'reviolating their fiduciary duty.
And that's notwhat business is for.
And it's
not supposed to take otherpeople's money and then use it
in ways
that they haven't explicitlyauthorized you to, to use that.
Ethan.
I kind of piggybacking offwhat Mackenzie said,
I think there's no argumentthat people,
(13:51):
want to make money, that youlike more money than less money.
And when you include this
environmental, social governanceaspect, you're allowing
these corporate managers or,or firm investors to take,
take people's moneyand put them into projects or,
initiativesthat are more controversial.
so I think,
(14:13):
allowing people to
be confidentthat their money is being spent
in ways or invested in waysthat will secure higher profits
and not necessarilysocial causes.
is a big part of what we'vetalked about in the program.
so ESG has beena big part of the,
the program that we talked aboutand, stakeholder
capitalism,like documenting, has mentioned.
(14:33):
And, Dan,
if I may, there are othervehicles for investors who wish
to put their money towardssocial or environmental causes,
and they are charity.They are philanthropy.
You don't have to put your moneyin an index fund
in order to try to makethe world a better place,
according to your vision of whatthat ought to be.
And and and to be clear,you know,
(14:56):
as investors are freeto invest their money
however they want and absolutelyhave strong values.
And they think thattheir business
or their financial investmentsshould be consistent
with those valuesand not invest in things
that they don't personally thinkmake the world a better place.
They're free to use their moneyhowever they want,
and at some level,you could expect to see
financial markets aggregate,you know, offer products
(15:19):
that would sort of appealto such investors.
But, you know, the issues that
that we are dealing with withESG are far more complicated.
And with that than that,it's like
is of usingsome other people's money,
without explicit consent.
And like,as you said, Mackenzie,
they consider this issue of, fiduciary duty and
(15:40):
and so, yeah, it's importantto, to understand
exactly what's going on withsome of these, these issues.
So, Alan, tell us a little bitabout some of the different
speakers and some of the wayswe've gone about,
you know, advancing both these,these ideas.
Sure.
Some of our recent speakershave been, Alexandra Hudson,
(16:01):
who spoke about,
the importance of civilityto society writ large.
Andy Alabaster of the HeritageFoundation, one of,
Troy University's distinguishedalumni, Jay Nordlinger
from the National ReviewInstitute.
Ben Johnson, a professorfrom the University of Florida,
spoke about corporate law andissues related to corporations.
(16:22):
Richard Adler Cominco,who is now leading
the University of Wisconsin
to go, joined Scotton the School of Economic,
Thought and Research.what is it?
The School of EconomicThought and Leadership
at Arizona State University.
Anson Friedrichs,the president of Stripe Asset
Management, AndyPozner, the former, CEO of Ski
(16:42):
Restaurants, ScottShepherd of the National Center
for Public Policy Research.
These are just a few examples ofthe people who came and spoke.
But we also had,
generous organizationsdonate books for us to read.
For example,the American Enterprise
Institute, donated copies
of Morality of Markets Argumentsfor the Free Market System,
which was editedby Yuval of then,
(17:03):
the Cato Institute, donated copies of the case
for Shareholder Capitalism,which we read.
And then we've read books by, Jim Hardison,
seven Deadly EconomicsSins and Honorable Business.
These are really excellentbooks, and I know the students
worked really hard,to read week in and week out
because we either
(17:24):
we either did a reading group,which you directed, of course,
or we had a guest lecturercome in every single week,
with maybe the exceptionof spring
break in the spring and maybe, Thanksgiving break in the fall.
So this is a rigorous program,and it's a very deep commitment
that the studentsmake to the program.
And, I'm just excited about howwell it's gone and how much
(17:47):
the students have excelled.
I've seen them grow.
I've watched them learn.
that has been an excitingexperience for me personally.
Given have also been able to,
as you seefrom some of these pictures,
have an opportunity
to interactwith some of these speakers and
here on a one on one basis, or,
not just in our discussion,but,
(18:08):
you know, outside of that,at a dinner or whatever.
So and I think thoseare really important things
to add to the studentlearning experience as well.
Absolutely.
I think getting to knowthese speakers on a personal,
one on one basis leadsto a very interesting learning
experience, experiences,but also to opportunities.
I know we've had,
(18:28):
at least one student gainan important internship
through, interactionswith a guest lecturer.
So, Ethan,and what have been some of
the highlightsthat the uses of,
our speakers that we've had,coming in to talk to the group.
I've really enjoyed being ableto sit down with these speakers,
listen to them,
one of them, Ben Johnson,talking about, corporate,
(18:51):
activitiesand things like that,
and then going to dinnerwith him afterwards
and just being ableto pick his brain on,
I mean, the classeshe's teaching.
And I believe I would say that,things of that nature
and to just like the book clubin general,
it's kind of
when we first found outthat we were going to be reading
books is a little daunting,adding another two books
onto the, schedule of classesand things of that nature.
(19:14):
But they've actually beenreally interesting books.
And it's easy.
It's kind of,
a page flip, not necessarilythriller or anything,
but it's still interestingbeing able to read these books
and kind of compare themto the real world
and thingsthat I'm seeing at work as well.
Yeah, I think that
both of those, books
that you mentioned, Alan,
that we covered this lastsemester, were very well done.
(19:36):
And I commend, AEI and Cato forfor putting those out.
So because would have beensome of your,
highlights in the area of thespeakers, that, that stand out.
Yeah.
So, her name's escapes me, butshe wrote The Soul of Civility.
That's AlexandraHudson. Let's see. Hudson.
Hudson was very interesting.
I think she's beenmy favorite speaker
(19:56):
that we posted so far,
just because I thoughtwe had a really good
in-depth conversationabout what being civil means.
And we sat down at dinnerwith her in the conference room,
and that was justa really great experience.
And she
we have copies of her book,and I have read some of it,
and I thoughtit was really interesting.
but I would also just say that
(20:17):
the biggest highlight for me
was probably likefinding community
in the business school
and specifically in the econ
department, because I'mnot an economics major,
but being ableto build connections
with economics professors
and other econ students has beena really good experience.
And just getting more context
of my business educationfrom all the books we've read,
I would say thatit's been really helpful
(20:38):
going through
my introductory business classes
and having a greaterunderstanding of what all
we're talking about in class.
So this program is definitelyhelped me in that aspect.
And so you think it's added
some things beyond anythingyou're getting in classes? Yes.
And Ethan,you I see what you said.
it's it's been two
principal classesand kind of go into it
(20:59):
knowingmore than the other students.
Do you hear about these, shareholder capitalism concepts?
And some of the other studentsare struggling to grasp it.
We're meeting weekly
and discussing these thingswith one another
and kind of picking each other'sbrain, picking your,
YouTubes brain about the topicsand conversations as well.
So I think overall it'sbeen a beneficial, club to be
(21:20):
a part of
it. And so we've been
talking recently about,you know,
perhaps expanding our programnext year to,
hey, guess after the studentsgo through the a reading group
to perhaps try and get theminvolved in research
on these important topicsbecause like,
that's another,I think, important thing
that that we as a universityshould be trying to do is as,
(21:41):
introduce,our students to, to research,
because that's what we doas professors.
And it's what you know,got many of us
into, our career because we,we love doing research.
And, and so I think it's
really important toto try and introduce
students to do researchand then allow them to also
not just read about,but actually do something
(22:02):
about some of these issuesof the day.
Right?
That's exactly right.
And the Johnson Centerhas been inundated
by requests for research becausethis program is so unique.
It is on the map, so to speak.
People are noticingwhat we're doing,
and we're working in a spacein which there happens
to be a high demandfor research.
(22:24):
So allowing the studentswho go through the program to,
as it were,a graduate into a research
position is helpfulnot just for them
and that
they are
now equipped to do researchand they actually get
to do research.
But also, it's helpfulto all the people out there
seeking more information,more data
(22:46):
about, for example, ESG or about the shareholder versus
the stakeholder modelof corporate governance.
And thanks to the generousdonations from private donors,
we're able to take this programto the next level.
the Bradley Foundationhas been particularly generous.
We have, a new, donorand the ACC Foundation,
(23:06):
the acting Institutehas been contributing.
I mentioned
AEI and the Cato Instituteproviding books for the program.
And then locally herewe have Alpha,
which has providedsome funding for the program,
and then just numerousprivate donors
just giving one small gifthere, one small gift
there, has enabled usto grow the program
to fund the students, to providebooks for the students,
(23:28):
to give them scholarship money,
for participatingin the program.
And now to take itto the next level
where we will havenot just a new,
a new, core of studentsgoing through the program
as it has been operatingat the last two years.
But, have new positionsin which we have the people
who have gonethrough the program
(23:49):
start doing research and start,I'll start really
taking their learning andunderstanding to the next level.
Well, in our this year,of free enterprise, scholars
have worked on some op edsto discuss something.
So, you know, Ethan,you were working on an op ed
related to, unions, which seemsparticularly timely.
(24:10):
Today.
We are in Alabama since therethere's a unionization drive
at the, Mercedes plant outside of Tuscaloosa.
So tell us a little bit aboutwhat you've been, right about.
so that's primarilythe reason I did decide to
write this paper is workingin Montgomery.
It's kind of been a hot topic.
We've seen the governorput out a press
release about labor unions.
(24:32):
the commerce secretary,the leaders of the House
and Senate have, put up things.
So I thought it'd be interestingto kind of dive
into this topic and
and figure out
the historical context of laborunions, how at one point
they were, in the benefitof the workers because we didn't
have these laws or regulationsin place, to protect workers.
But over time, we have over180 federal regulations,
(24:56):
regulating governing workplaceactivities,
relationship between employers,employees, and standard
health and safety,guidelines for workplaces.
So I think over time they havebeen beneficial for workers.
But in today's current contextand political climate,
I don't really seethe need for labor unions.
(25:17):
I think they get more in the wayand try to uplift a few while
taking away jobs for some ofthe ones that really do need it.
Some of the younger,
people, people that do not havethe skill set necessary.
so I thought it wasreally interesting.
I, attended a, colloquiumin Vermont
last summer,and we read Milton and Rose
Friedman'sbook, Free to Choose.
(25:40):
And he talked a lotabout labor unions
and how they, they upliftsome of the few
in the community,but take away a lot from others.
So I just
I like learning moreabout labor unions and kind of
putting my perspectiveand spin on it,
why they're not necessarilyneeded in today's society.
And and Mackenzie,you were wrong about it.
So you made it to Cuba.
(26:00):
So tell us a little about your
trip to Cuba and what you sawabout socialism and socialism
failures up close and personal.
Yeah.
So I had the opportunityto study
abroad in Cuba last December,and it was a great experience.
But one of my biggesttakeaways from that
was that their economic system
and their government has failedthem.
life in Cuba is very differentthan it is here.
(26:22):
There are no public amenities.
there are people everywherein worse
poverty than I've ever seenin this country.
So I think that
the socialist system in Cubareally contributes to that.
They don't support businesses,they don't support innovation
or entrepreneurship.And it shows.
so that's what I wrote about.
(26:44):
and talking about thelacking of Cuba and its economy
and how its citizenssuffer as a result.
And I mean, lots of,college age students have
a high opinion of socialism,so perhaps they should go.
I mean, Cuba's only 90 miles offthe coast of Florida, and so
perhaps they could go see,how how socialism work
(27:06):
is working out in in personthere, right, absolutely.
And so,
Alan,tell us a little bit about,
you know, I guess
it was touch a little bitwhat we wanted going forward.
But you know what, what do you see
in, in terms of the futurefor our program here
and what might be the doingover the next year or so?
Well, I think we are lookingat hosting
(27:26):
an eventregarding ESG in the fall,
and we will be focusinga lot more on research.
I know you and Iare both working together
on articles regarding ESG.
I've got a special issue of theAlabama Lawyer, which is the
magazine of the StateBar publication
that's coming outon, on, specifically ESG.
(27:47):
It's a corporate law issue,but we're focusing on ESG.
And I know, we are going to bebringing together researchers
from other institutions, bothThinktanks and universities,
to start coordinating, and producing more research.
And, of course, our studentsare going to be a central part
of this experience as well,which will be exciting.
Yeah.
And I really look forward to
(28:08):
bringing some new studentsinto the program and continuing
to, to work with, some of our university's
most outstanding,undergraduates.
So, again, thank you. McKenzie.
And thank you, Ethan,
for participating our programand for coming on this, show.
And thank you allfor joining us.
Join us again next timefor another conversation.
(28:33):
This has been conversations,
a joint production of TroyTurgeon Vision and the Manuel H.
Johnson Center for PoliticalEconomy at four University.
(29:12):
So, Dan,you really just want to shoot
a promo on camera twowith everybody in the shot?
if you wanted me,
I was goingto do a little promo,
but you guys can get upif you want, or they'll.
They'll probably be ableto just zoom in on me
and talk to me there.
Be I can.
any one. Thing.
All right.
(30:04):
I think I got this figured out.
Stand by.
(30:28):
Is it possible to reclaim
the traditional virtues ofcommerce for American business,
or our business and finance now
to be employedas tools of social engineering?
I'm Doctor DanSnyder of the Johnson Center
for Political Economyat Troy University.
Join meon the next conversations
when we'll be talkingabout our free
enterprise Scholars program.
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Current and classic episodes, featuring compelling true-crime mysteries, powerful documentaries and in-depth investigations. Follow now to get the latest episodes of Dateline NBC completely free, or subscribe to Dateline Premium for ad-free listening and exclusive bonus content: DatelinePremium.com
Cold Case Files: Miami
Joyce Sapp, 76; Bryan Herrera, 16; and Laurance Webb, 32—three Miami residents whose lives were stolen in brutal, unsolved homicides. Cold Case Files: Miami follows award‑winning radio host and City of Miami Police reserve officer Enrique Santos as he partners with the department’s Cold Case Homicide Unit, determined family members, and the advocates who spend their lives fighting for justice for the victims who can no longer fight for themselves.