People blame MBAs a lot, but most CEOs are Engineers or Economists by training.
https://www.theatlantic.com/ideas/archive/2020/02/how-mckins...
History shows profit maximizing behavior in letters dating to 1900 BCE Egypt and 1800 BCE Anatolia by Assyrian merchant houses.
I appreciate the analysis you're making, again, but it is low resolution. There's a lot more nuance to what you're saying and it definitely doesn't come down to MBA graduates in the past few decades.
The consultancy-private equity complex for example is a big part of the shift in American culture after "Greed is Good" was said out loud in the 1980s. Why this cultural shift happened? "Because MBAs" is not as much of an answer as it is bar talk simplistic hand waving to end a conversation and change subject.
The Chicago school hadn't yet convinced everyone that fiduciary responsibility to shareholders was the prime concern of the C-suite and the board either. Those were economists, not MBAs. Deregulating the market also played a part.
Leveraged buyouts used to boom when another industry went bust. Companies would save some assets of a company that might otherwise be liquidated altogether, and sometimes rebuilt the company into a healthy one. Think junk bonds, the S&L crisis, the dotcom bust, and such. PE also used to take over lots of family-run businesses with succession issues so the companies could continue.
With relaxation of laws and regulations and more examples set by financiers, more of the acquisitions landscape shifted toward the corporate raider type of LBO.
Besides the circularity in saying that a cultural shift happened because something changed, Investment Banking is a thing since at least 1932 when the Glass-Steagall act was passed to enforce separation of concerns between "commercial banks" and "investment banks".
Venture capital dates from at least the 1950s:
The Venture Capital Revolution https://doi.org/10.1257/jep.15.2.145
"The first true venture capital firm was American Research and Development (ARD), established in 1946 by MIT President Karl Compton, General Georges F. Doriot"
As for Leveraged Buyouts, I highly recommend this analysis of 2000 cases done in 1993 which is far from any categorical conclusions on LBOs being a straightforward phenomenon that can be explained away in four sentences.
The Determinants of Leveraged Buyout Activity: Free Cash Flow vs. Financial Distress Costs https://doi.org/10.1111/j.1540-6261.1993.tb05138.x
It explicitly asks:
1. Do LBOs create wealth, or do they merely redistribute wealth?
2. Does the debt taken on in LBOs cause problems in periods of economic distress?
My point being essentially: don't hand wave historical analysis away. Get into it, read the papers, and the primary sources. History is fascinating and full of interesting questions about why things have come to be how they are in society. Whenever I feel intrigued by some historical question, and I decide to question the facile explanations that come to mind, I am endlessly fascinated by how complex and nuanced things are, and by how much analysis has been published starting out with the same questions as I asked myself.
Agreed. I think "MBA" is often used as a synonym for "person who views a business as a bunch of numbers that need to exploited for maximum profit"
Even back then, long before the word "enshittification" was coined, it made me squirm.
It did make a bit more sense back then. In the early 20th century there was a lot of utterly massive overproduction that greatly increased the price of some good for everyone while not giving improved service. I recall a house a relative had, which has about an 18"x18"x12" cast iron grating to distribute forced air between two floors. Unbelievably overproduced for the purpose. In the 1990s quality was still decent, and overproduced in some areas. But the trend was clear, and yea verily these 30 years later, it most certainly continued.