An AI Logic Exercise: Gordon Gekko
Was Friedman Wearing Blinders?
I have had numerous discussions over the years with my writing partner about America’s problems and how they can be addressed. Whenever Paula and I have one of those lengthy discussions - you know the ones… we solve all the world’s problems over a glass of wine or bourbon (neat) - we start with a problem and try to work our way back to the root causes.
I am attempting an interesting twist on this practice (by leaving the wine uncorked?) by trying these discussions as “logic exercises” with AI.
After a few of these, I’ve come to a few conclusions about AI… but I’ll keep those to myself for now to allow you to draw your own conclusions after reading our “AI Series.”
Usually, (never because of the alcohol, mind you…) when Paula and I have one of these world-altering discussions 🙂, we meander from topic to topic, tying distinct points into a clarifying pattern.
Many times, as we track back to root causes, we end up encountering one of Evagrius Ponticus’ points of human failure. Greed. So that is where I have decided to start.
Inevitably, whenever we hit on greed as a root cause (which happens often during our “vina philosophia”), Paula refers back to the “Friedman Doctrine” as an example of where we (the US) went wrong.
To explore this, I attempted a “logic exercise” with an AI. The conversation takes a Trumpian “weave” or two, but it ends up on topic, and I hope that you enjoy this first attempt in our “AI Series.”
The AI Series posts don’t draw immediate conclusions outside of the conversation but will fuel future posts on strategy and world events that reference the insights (or lack thereof) gained from these logic exercises.
Those of you who have used artificial intelligence know that our AI Overlords can be as long-winded as Castro. So, what follows is the Reader’s Digest version of the logic exercise. The full transcript (along with all my typos and AI’s 100,000 examples) are included here:
—My prompts are in bold text. The AI response is in plain text—
Enjoy!
Provide a synopsis of Milton Friedman's article "A Friedman Doctrine - The Social Responsibility of Business Is to Increase It’s Profits."
Milton Friedman’s 1970 essay, A Friedman Doctrine: The Social Responsibility of Business is to Increase Its Profits, argues that a corporation's sole responsibility is to maximize profits for its shareholders, as long as it operates within legal and ethical boundaries.
Friedman’s doctrine has profoundly shaped corporate governance, reinforcing the idea that businesses should focus on financial performance rather than broader societal issues. However, contemporary perspectives—particularly those advocating stakeholder capitalism—challenge this view, arguing that corporations have obligations to employees, consumers, and society alongside shareholders.
Provide a synopsis of the evolution of the corporation as a person using US Legal precedent
The concept of corporate personhood in U.S. legal history has evolved through key Supreme Court decisions, shaping how corporations are treated under the law.
Early Foundations (19th Century)
Santa Clara County v. Southern Pacific Railroad (1886)
Expansion of Rights (20th Century)
Dodge v. Ford Motor Co. (1919)
First National Bank of Boston v. Bellotti (1978)
Modern Developments (21st Century)
Citizens United v. FEC (2010)
Burwell v. Hobby Lobby (2014)
These rulings have strengthened corporate personhood, granting businesses rights similar to individuals while sparking debates over corporate influence in politics and society.
What did the Founders of the United States say about a citizen's responsibility to the Nation?
Foundational Civic Duties According to the Founders
Education & Awareness: Thomas Jefferson emphasized that an informed electorate was the backbone of democracy, advocating for widespread knowledge. James Madison reinforced this by stating that popular government without informed citizens leads to tyranny.
Political Participation & Accountability: Alexander Hamilton and George Washington warned against political complacency, urging citizens to engage in governance, vote wisely, and hold leaders accountable.
Defense of Liberty: Benjamin Franklin famously stated, "A Republic, if you can keep it," highlighting that freedom demands continuous vigilance and effort. John Adams echoed this, linking the preservation of liberty to the people's engagement.
Moral & Ethical Citizenship: The Founders believed that a strong republic depended on the virtues of its people. Washington stressed that personal character and civic virtue were necessary to uphold laws and maintain order.
Active Defense of the Nation: Some, like Washington, viewed military service and defense of the country as an important civic duty, ensuring national security and sovereignty.
I want to conduct a logic and reasoning exercise by requiring you to draw conclusions based on my prompts.
That sounds like an interesting challenge! I’m ready to engage in structured reasoning and draw logical conclusions based on your prompts. Feel free to provide the first scenario or statement, and I’ll analyze it step by step to derive a conclusion. Let’s put some critical thinking to work!
Based on the information we have looked at today, is a corporation a person?
Legally speaking, corporations are treated as persons in the United States, but only in a limited legal sense—not in the way human beings are recognized.
The Founding Fathers never explicitly recognized corporations as persons. Their views emphasized individual civic responsibility, and they likely would have viewed corporate personhood skeptically in the context of influencing governance.
So, while corporations are legal persons, they are not individuals with moral or civic duties—their rights exist within a structured legal framework.
Do corporations have the same requirements as any other US citizen?
Corporations do not have the same requirements as individual U.S. citizens, despite being granted certain legal rights under the principle of corporate personhood.
Corporations have legal personhood, but they do not bear the same civic obligations or individual responsibilities as citizens. Their rights are selectively granted based on legal precedent and economic function.
Can US corporations be forced to support US war efforts?
Yes, U.S. corporations can be compelled to support war efforts, but the extent of their obligation and the key difference between corporate obligations in war efforts and compulsory military service for individuals lies in their legal basis, enforcement mechanisms, and the nature of their responsibilities.
Compulsory military service directly forces individuals into defense roles with personal risk and strict command structures. Corporations, while obligated to aid war efforts, do not face personal danger and retain some flexibility in how they comply with federal directives.
Is that a technical or philosophical difference?
That distinction is both technical and philosophical, depending on how you frame the analysis.
Philosophical Difference: Responsibility & Agency
Philosophically, the debate hinges on the nature of responsibility:
An individual citizen is expected to make personal sacrifices for the nation.
A corporation, as an entity, is driven by profit motives and can argue that its primary duty is to its shareholders (Friedman’s doctrine).
This raises the ethical question: Should businesses have moral obligations similar to individuals, or should their duty remain purely economic? Critics argue that corporate personhood grants businesses rights without the corresponding civic duties imposed on individuals.
The technical difference lies in legal mechanisms and enforcement, while the philosophical difference involves debates on duty, agency, and ethical responsibility. This divide fuels ongoing discussions about corporate influence in governance and the extent to which businesses should bear obligations similar to citizens.
Is capitalism the required economic system under the U.S. Constitution?
No, capitalism is not explicitly required under the U.S. Constitution. The document does not mandate any specific economic system, but it does establish principles that have historically supported a free-market economy.
Historical Interpretation
The U.S. has historically embraced capitalism, but the Constitution does not require it.
Some scholars argue that the Founders designed the government to protect economic interests but not enforce a specific system.
Does Friedman's Doctrine hold if the government can destroy a business? Would not the primary motive of a business be survival as opposed to profit?
That’s a fascinating challenge to Friedman’s doctrine. His argument—that the sole responsibility of a business is to increase its profits for shareholders—assumes a relatively stable free-market system, where businesses operate within legal and ethical constraints. However, if the government can destroy a business, it fundamentally shifts the primary motive from profit-seeking to survival.
Friedman’s doctrine loses its pure application when business survival is uncertain due to government intervention. In such a scenario, profit maximization becomes secondary to ensuring the company can continue to exist within legal and political constraints.
Taking that into account, assume that government can destroy businesses (the power to tax and regulate is the power to destroy) and that corporations have personhood. Is it not in the best interest of the corporation to be a good "citizen" as a person?
Logically, yes—it would be in a corporation’s best interest to act as a "good citizen" if it is granted personhood and faces existential threats from government power.
Under the assumption that corporate personhood exists and government can dismantle businesses, behaving as a good "citizen" is a rational strategy for ensuring survival, maintaining influence, and securing long-term success. This challenges Friedman’s doctrine by suggesting that corporate responsibility is not just a philosophical debate—it’s a practical necessity in a regulated environment.
Taking this into account and the fact that the corporation has personhood, what is the stockholder relationship to the corporate citizen? Use a biological example.
If we extend the analogy of corporate personhood into biology, the stockholder’s relationship to the corporation is akin to that of a symbiotic relationship, such as blood cells and the body or neurons and the brain—essential for function, but distinct in role.
Do Apple or Microsoft's stockholders function as the blood of their corporations? Does their input have that much weight? Or are they more like beneficial gut microbes?
That’s a sharp refinement of the analogy—stockholders likely do not function as the "lifeblood" of massive corporations like Apple or Microsoft. Instead, their role is more passive yet still symbiotic, similar to gut microbes in a biological system.
Why This Works as a Better Analogy
Corporations do not require constant shareholder input to survive, much like the human body continues functioning regardless of which microbes are present at any given time.
Their survival strategies focus on market positioning, regulation, and competition, not individual investor actions.
Just as gut microbes thrive when the body is healthy, shareholders benefit when the corporation is successful—but neither completely controls the other.
This shift in perspective makes corporate personhood even more fascinating—suggesting that shareholders are supporting actors rather than core life-givers.
Taking this logic exercise into account, rework the Friedman Doctrine to better encompass: 1. The Corporation as a Person. 2. The Stockholder as a diverse gut microbiome. 3. The Founder's beliefs about a US person's responsibility to nation.
A Revised Friedman Doctrine: Corporate Responsibility in a Personhood Model
Milton Friedman's original doctrine argued that the sole responsibility of a business is to increase its profits for shareholders. However, given modern legal interpretations of corporate personhood, the biological analogy of shareholders as a diverse gut microbiome, and the Founders’ beliefs about a citizen’s responsibility to the nation, a more comprehensive framework emerges—one that acknowledges survival, ethical obligations, and civic duty.
Since U.S. law recognizes corporations as legal persons, businesses must be understood as entities with rights, responsibilities, and survival instincts beyond profit maximization. Like any citizen, a corporation has obligations to operate within legal and ethical boundaries, secure its long-term survival (rather than focusing solely on short-term profits) and engage with government and society, ensuring stability within its operating environment.
Thus, corporate decision-making must be more than just profit-seeking—it must include self-preservation, adaptability, and responsible governance to sustain its existence. A responsible corporation does not simply chase immediate gains for shareholders—it maintains long-term stability, ensuring that both it and its investors benefit from sustained health rather than short-lived market surges.
If a corporation is a person, then by extension, it bears some civic responsibilities—mirroring the Founders’ vision of an engaged, ethical citizenry. As Franklin warned, “A Republic, if you can keep it,” liberty requires vigilance and active participation.
This revised doctrine moves beyond pure profit maximization, incorporating survival instincts, stockholder balance, and civic duty into corporate behavior. If the government has the power to regulate and tax (i.e., destroy) corporations, businesses must prioritize survival and align themselves with ethical governance—not just profit.
Thus, corporate responsibility evolves into three primary objectives:
Ensure survival through strategic adaptability rather than blind profit-seeking.
Balance shareholder interests with corporate health, functioning as a stable system rather than a short-term wealth generator.
Act as a responsible corporate citizen, ensuring ethical and legal participation within governance and society.
Profit and Survival. When a for profit business shifts from profit mode to survival mode it is called Goal Displacement. This happens in bureaucracies as well. It happened at WHINSEC. In 2000 and 2001 all hands where focused on survival. Student numbers dropped to record lows, USARSA lost a vote in Congress, and both USARSA and the Army where looking how to save the mission and sacrifice the school. We had spent the last decade trying to build a coalition of vocal stakeholders inside DoD and DoS as well as other government agencies. We created curriculums and courses that targeted funding beyond the normal IMET and FMS. We went after CINC initiative money, INL, CT, etc. Our student load became heavily police dependent, in a US Army school house! We promoted ourselves to anyone who would listen as a jack of all trades. We spent gobs of money trying to be CGSOC at Fort Leavenworth. With all this outreach and desire to please as many stakeholders as possible, we didn’t do enough for one to be irreplaceable. In some instances we were duplicative. A Jack of All Trades, but a Master of None. Our budget ballooned passed $10M while our reimbursements dwindled to less than $2M (the same amount every year when I joined in 1988!!). Our metrics for success where non-existent or false. Every year was about survival and not “profit” per se. We needed to refocus and be a white dwarf star not the Red Giant we were. Realign ourselves to target the 2M that security cooperation funds provided us to fewer students but having a better engagement experience in the USA. I am 4 years removed from it now, but the online course catalog reads the same 2 commanders later! I suspect WHINSEC is still stuck in survival mode looking for love in all the wrong places!
Love it, John. We need another "vina philosophia” soonest-but please note: now that's it's officially summer, I drop the vino for a G&T! (or a Cape Coder")