An interesting observation—or perhaps intuition—from Tomáš Baťa, the most important Czech industrialist in history, from the early 1930s. In his view, one of the central economic problems of the time was the excessive cost of construction, real estate, rents, and related expenses. The consequence, he argued, was that people and businesses were pouring resources into buildings and leases that ought instead to have gone toward machinery, wages, training, research, and development. Baťa even believed that excessively costly construction had done more damage to the German economy than war reparations.
It makes one wonder how he would comment on our neoliberal age, in which the financial system is structured to push property prices ever higher, and in which the constant appreciation of real estate is treated as a primary sign of prosperity. He would probably say that such a system cannot function indefinitely.
Yet another key principle of his economic thinking was that once a company reached a size significant to the national economy, it effectively became something akin to a national institution. Its leadership, he believed, could no longer orient itself toward maximizing profit alone, but had to consider the prosperity of the nation as a whole. The strategy of such a company should be public, and its management accountable to the entire nation rather than merely to shareholders. Baťa himself understood his factories in precisely this way and described himself not as an owner, but as a steward.
It is unclear how exactly such a principle was meant to be enforced. Baťa assumed that the general moral climate and social pressure would naturally compel the owners of large enterprises to behave in this manner. The notion that a director might answer to someone abroad would have been inconceivable to him. But if the director or owner of a major firm refused to act accordingly, should the state intervene? Or even expropriate the company? We do not know.
What we do know is this: in the economic vocabulary of our own age, Tomáš Baťa would almost certainly be described as a “socialist” or an “etatist.”