Last Updated 10 May 2020

General Electric Price-Fixing Scandal

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The Price-fixing scheme, in Burke’s belief, was done primarily in order to control prices but only to set prices which are of value in accordance with their products and not for gaining outrageously huge profit and monopolizing the industry. If that is the real aim of the price-fixing scheme, then it is a practical move for the companies. Aside from ensuring that the prices set would only be getting fair market value, it was also a move to keep the industry healthy. However, from an ethical point of view, the price-fixing scheme is not as good as it would seem to be.

Price-fixing violates the antitrust law basics. Anti-trust law basics ensure that any contract or agreement made to restraint economic freedom is protected. Furthermore, antitrust laws will also help ensure customers to a free market with lower prices and more choices (Quinn). If the antitrust laws were to be violated, such as a price-fixing scheme, it may unavoidably result to monopoly of the industry. Aside from that, the society may be forced to buy merchandise on a higher value because without the benefit of choices due to lack of it in the market.

This would violate the society’s right to a fair and equal trade. The price-fixing would only be beneficial to a few of the society’s division, specifically the large market holders. Since prices will be fixed, assuming that the large market holders will be fixing the price, it will most certainly be beneficial for them alone. The large scale market holders will have monopoly of the trade and will earn most profit as compared to the small scale market. This may cause an uneventful death of small-time market holders, thereby, reducing more the already limited market alternatives.

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This would also increase the society’s load for carrying the distributed burdens caused by the death of small-time businesses. The death of the small-time businesses may result to higher prices, i. e. large market holders’ monopoly of the market. Aside from that, there is also no assurance that the price fixed for the commodity is of fair market value. It cannot be determined whether or not consumers are getting the worth of their money. In the case of Clarence Burke’s connection with the General Electric and other companies’ price-fixing scheme, it was almost unavoidable that he would also become involved in such an illegal practice.

Burke, even with the antitrust policy number 20. 5, which is a policy signed to comply with the antitrust directives, still will not be able to get his psyche to accept that what he was doing was illegal. It was already in bred in him before his rise in the corporate ladder. As Manuel quoted, Burke says, “I ascertained that it [was the usual way to act] because my superiors at Pittsfield were doing it and asking me to do it. So it was their practice”. Though Burke was also aware of its illegality, it is hard for him to not get involved especially when his job clandestinely demands it.

As Upton Sinclair puts it, "It is difficult to get a man to understand something when his salary depends upon his not understanding it. ” And so, illegal or not, so long as his job demands it and “sees” it as good for the society, Burke would engage in it. Clarence Burke already acted wrongly when he engaged in the price-fixing scheme because he would one of those responsible for restricting market freedom. He was also morally responsible for his actions as his actions would inevitably cause consequences of sorts.

What he did was unethical and morally wrong which could only be forgivable through contrition in the act of testifying against the other companies which engaged in the violation of the anti-trust laws. His willingness to testify however was as much an act of repentance as it was an act of saving his skin.

References Quinn, Eugene R. , Jr. Antitrust Law Basics. Retrieved May 4, 2008 from http://www. ipwatchdog. com/antitrust. html. Velasquez, Manuel. Pearson Education, Inc. General Electric Prices. Retrieved May 4, 2008 from http://wps. prenhall. com/hss_velasquez_busethics_6/38/9874/2527827. cw/index. html.

General Electric Price-Fixing Scandal essay

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