When profits and Wall Street are un-American activities

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If an award existed for corporate courage, the winner last week would surely have been Du Pont Co for announcing plans to eliminate 1,500 positions in a bid - oh, my - to boost profits. Didn't anyone warn the folks down in Delaware not to mention job cuts and profits in the same breath?

Well, of course someone told them, which made them either brave - or daft. There can hardly be anyone left in America who does not know that companies laying off large numbers of workers have become the favourite punch-bags of candidates on the Republican campaign trail. It used to be that it was Moscow and the Reds that they bashed; now it's AT&T and Goldman Sachs.

Patrick Buchanan started it with his excoriations of big business and Wall Street last month. His pitch was simple and it struck a chord: ordinary working Americans are being sacrificed by chief executive officers who care only about the bottom line. Worse, the more they cut, the higher their own rewards seem to rise and the more stratospheric the performance of Wall Street.

Mr Buchanan spits bile at Goldman Sachs and Chase Manhattan, claiming they were the ultimate beneficiaries of the taxpayer-guaranteed $50bn bail-out of Mexico by the US government last year. But his favourite target is AT&T.

In this sport, AT&T is hard to miss. Last month, the telecommunications colossus said that as part of its three-way demerger announced last year, it was to cast away 40,000 of its workers, most of them white-collar managers. Then, last week, we learned that the CEO, Robert Allen, saw his pay package swell by several million dollars last year, thanks to a large dollop of share options. You probably know the joke by now: AT&T stands for Allen and Two Temps.

Newsweek emblazoned the headline "Corporate Killers" on a recent cover with mugshots of such corporate chiefs as Allen himself, Louis Gerstner of IBM and Albert Dunlap, formerly of Scott Paper. Beneath the faces were the numbers of jobs each had eliminated. Columnists everywhere have mused about an impending backlash in the workforce and the need for a new spirit of corporate responsibility.

There are multiple reasons for the excitement. For one, you have a Republican - and, on social issues, an ultra-conservative one - attacking the constituency that the party has traditionally counted on for money and support. Furthermore, Mr Buchanan has managed to drag in others of his party, including Senator Bob Dole.

And the Buchanan rhetoric fits well with the widely shared observation that whatever the statistics say about economic recovery - falling rates of unemployment and low inflation - there is still no discernible feel- good factor among America's voters. Rather, there is a discernible middle- class angst. An estimated 3.1 million lay-offs have been announced since 1989. While wages and benefits rose just 2.8 per cent in 1995, according to US Labor Department figures, corporate profits climbed 22 per cent. The actual purchasing power of workers has remained flat for the last 15 years.

And those who toil for those profits seem to be losing some patience. The latest issue of Business Week includes the results of a Harris poll that shows, for instance, that 94 per cent felt corporations should be concerned about more than just making money.

However, as far as anyone can tell, Mr Buchanan is not proposing anything beyond throwing up some wall around America to keep out cheap imports and discourage illegal immigrants. As to how corporations like AT&T might be nicer to their employees, Mr Buchanan has said nothing. The logical conclusion to his tirades would be to encourage a "stakeholder" approach in American industry. How about a Social Charter for the US?

Not likely. Interviewed by Newsweek, Mr Dunlap, whose Scott Paper is now part of Kimberly-Clark, had this to say about government intervention: "Politicians don't seem to be getting the message. They pander to the public and polarise people. And they try to tell American industry how to conduct its business. God help us if we pass legislation to make American companies less productive and compromise our global competitiveness." In their hearts, neither Mr Buchanan nor Mr Dole are likely to disagree.

Some Democrats have, however, woken up to this opportunity to take the initiative. Senator Edward Kennedy has called for legislation that would oblige companies to report publicly on the steps taken to protect the welfare of their workers. Two other Democratic senators have tabled bills that would create tax breaks for companies that demonstrated concern for their employees.

And it is just possible that, after 10 years, downsizing in the US may have peaked. In the week of 14-21 February, there were half the number of lay-offs compared with the same week a year ago. But there is another possible explanation: until Du Pont, no other corporation had dared risk replacing AT&T as Mr Buchanan's target.