- Created: 22 March 2017
The topic of corporate ethics and social responsibility is a hot button issue in our capitalist system. As Jews, we are held to a high standard with regard to how we conduct business transactions. In his article, “McDonald’s Disturbing Morality Tale,” Rabbi Benjamin Blech uses McDonald’s as a case study to apply Jewish business ethics to modern day capitalism and arrives at a surprising conclusion:
Just imagine if you would’ve been lucky enough to purchase 100 shares of McDonald’s in 1965 at its initial public offering price of 22.50 – costing you $2250. You would now have about $10 million, in addition to having received hundreds of thousands of dollars in dividends throughout the years.
All because you participated in one of the greatest success stories of American business. McDonald’s is today the world’s largest company in the restaurant industry. It’s the world’s leading global food service retailer. It has a market capitalization of well over $100 billion. It sounds like the epitome of the American success story, but there is a dark side to how McDonald’s became a financial empire, brought to chilling life in the recent film The Founder.
Mario Puzo’s novel The Godfather recounts the violent tale of a Mafia family. The epigraph he selected for this story of crime, corruption and evil is the fascinating quote from Balzac: Behind every great fortune there is a crime.
That quote captures the truth behind the McDonald’s fairytale. The incredible growth of Dick and Mac McDonald's Bar-B-Q in San Bernardino, California in 1942 to its present-day behemoth stature, which prides itself on the theme of family and was proud to identify itself as “the new American church,” was built on the crimes of Ray Kroc – the man who proclaimed himself the founder of McDonald’s when in truth he stole the idea, the name and the business from two hard-working and creative brothers.
Ray Kroc made it to the top because he embraced the following guiding principles enacted in the film:
*Business is war.
*If I saw a competitor drowning, I would shove a hose down his throat.
*Contracts are like hearts – they’re made to be broken.
When Ray finally puts the squeeze on the brothers who started the whole business and forces them to sell out to him, he asks as a personal favor that they not put in writing his promise to provide them with lifelong royalties. In one of the most powerful scenes of the film, Ray extends his hand and the brothers shake it to conclude the deal – a pledge of good faith with words and a handshake. The royalties involved would’ve given the brothers over $100 million a year. Ray Kroc didn’t keep his word and reneged on his handshake.
Ray Kroc’s “success” story is beyond anyone’s wildest dreams, but it was a success made possible through moral degradation and the most sordid downfall of character and compassion. The question every viewer needs to ask himself or herself is whether we watched Ray Kroc with envy or with disgust, with jealousy or with revulsion.
The founder – and even that was a lie – of McDonald’s was a fraud. His story of financial riches and ethical poverty should become a springboard for discussion for our young, for our children, and for all those who speak about Judeo-Christian values.
Is the meaning of capitalism the economic equivalent of Darwin’s survival of the fittest – and more power to all those who can grab the spoils from the weaker, the more defenseless, and the ones who can’t afford the better lawyers? Who are the American heroes – the ones who “make it” financially or the ones who maintain their self-respect and their spiritual connection to a higher authority of justice, of selflessness and of righteousness?
The Talmud (Shabbat 31a) teaches us that after we die there is a review of our lives and a final reckoning in the heavenly court. The Almighty asks us a number of questions for which we are held accountable. The very first question we will be asked is: “Did you deal honestly and in good faith in your business affairs?” Our worth in the heavenly ledger is not how determined by how much we made but rather on how we made it. And the rewards of the afterlife are reserved for those who knew the value of righteousness.
There is a remarkable ending to the story of Ray Kroc and the billions he illegally accumulated. Joan, the woman Ray subsequently married after divorcing the wife who struggled with him during the difficult early years of their marriage, passed away. But before she did, in the time after Ray’s death whose fortune she inherited, she became a one-of-a-kind philanthropist. The way people described it was that she took her level of giving “and supersized it.” She loved to surprise people, making staggering million-dollar gifts anonymously to individuals in need. For charities which appealed to her, the amount of her gifts was often in the billions. The only restriction was that she be accorded no honors and very often that her gift be recorded as anonymous.
There was the time when she camouflaged $500,000 as a holiday card for public radio, a $1 million delivered to a hotel room for AIDS research, $15 million in anonymous checks of $2,000 apiece distributed like candy to flood victims. One of the great American fortunes was being spent down, one surprise at a time, a seemingly whimsical redistribution of treasure.
Then, on a spring day, when making surprise gifts of staggering sums – before she felt the deadline pressure of terminal cancer – Joan Kroc stood briefly before a crowd of Salvation Army officers and San Diego dignitaries.
“I’m sure he [Ray] is looking down – ah, I hope he’s looking down ,” Joan Kroc then added. The audience broke down in laughter. And then Joan announced her gift to the Salvation Army to which she gave $1.5 billion – the largest gift ever to any charity.
The billions Ray Kroc acquired shamefully somehow made their way back to noble causes. Perhaps that is the way God rectifies the transgressions of those who fail to understand the real meaning of success.