The Man Who Broke Capitalism: How Jack Welch Gutted the Heartland and Crushed the Soul of Corporate America—and How to Undo His Legacy

Written by David Gelles

Narrated by Kevin R. Free

New York Times Bestseller

New York Times reporter and “Corner Office” columnist David Gelles reveals legendary GE CEO Jack Welch to be the root of all that’s wrong with capitalism today and offers advice on how we might right those wrongs.

In 1981, Jack Welch took over General Electric and quickly rose to fame as the first celebrity CEO. He golfed with presidents, mingled with movie stars, and was idolized for growing GE into the most valuable company in the world. But Welch’s achievements didn’t stem from some greater intelligence or business prowess. Rather, they were the result of a sustained effort to push GE’s stock price ever higher, often at the expense of workers, consumers, and innovation. In this captivating, revelatory book, David Gelles argues that Welch single-handedly ushered in a new, cutthroat era of American capitalism that continues to this day.

Gelles chronicles Welch’s campaign to vaporize hundreds of thousands of jobs in a bid to boost profits, eviscerating the country’s manufacturing base, and destabilizing the middle class. Welch’s obsession with downsizing—he eliminated 10% of employees every year—fundamentally altered GE and inspired generations of imitators who have employed his strategies at other companies around the globe. In his day, Welch was corporate America’s leading proponent of mergers and acquisitions, using deals to gobble up competitors and giving rise to an economy that is more concentrated and less dynamic. And Welch pioneered the dark arts of “financialization,” transforming GE from an admired industrial manufacturer into what was effectively an unregulated bank. The finance business was hugely profitable in the short term and helped Welch keep GE’s stock price ticking up. But ultimately, financialization undermined GE and dozens of other Fortune 500 companies.

Gelles shows how Welch’s celebrated emphasis on increasing shareholder value by any means necessary (layoffs, outsourcing, offshoring, acquisitions, and buybacks, to name but a few tactics) became the norm in American business generally. He demonstrates how that approach has led to the greatest socioeconomic inequality since the Great Depression and harmed many of the very companies that have embraced it. And he shows how a generation of Welch acolytes radically transformed companies like Boeing, Home Depot, Kraft Heinz, and more. Finally, Gelles chronicles the change that is now afoot in corporate America, highlighting companies and leaders who have abandoned Welchism and are proving that it is still possible to excel in the business world without destroying livelihoods, gutting communities, and spurning regulation.

• Language: English
• Publisher: Simon & Schuster Audio
• Release date: May 31, 2022
• ISBN: 9781797142173

David Gelles

David Gelles is the “Corner Office” columnist and a business reporter for the New York Times. Since joining the Times in 2013, he has written about CEOs, finance, technology, media, and more. He was part of the team that covered the fallout from the crashes of two Boeing 737 Max jets, work that won the 2020 Gerald Loeb Award for Breaking News Reporting. A student of Buddhism and a meditator for more than twenty years, David is an authority on the intersection of mindfulness and the business world. His 2015 book, Mindful Work: How Meditation is Changing Business from the Inside Out, was published by Houghton Mifflin Harcourt. Before joining the Times, he was a reporter for the Financial Times.

Reviews for The Man Who Broke Capitalism

[Steven Stankevitz · Rating: 5 out of 5 stars]

It was so good that I couldn’t put it down. Thanks Steve

[Hebert Espinosa · Rating: 5 out of 5 stars]

"Welchism" is a term extensively used in this piece of work to describe and explain practices that Jack Welch - a leader reverenced by so many, and for the wrong reasons - used to apply to his management style in order to achieve results that would meet the shareholder's expectations (which was to skyrocket GE's stock prices). Problem is that this style is essentially made up of aggressive cost-cutting (when cost-cutting was not really needed), shutting factories down leaving thousands of employees in the dark, unfair reviews that let people go, and compromising the quality of the products by outsourcing functions to inexperienced - and cheaper - labor, neglecting innovation through research and development, careless mergers and acquisitions that would only artificially boost revenues and profits for the short term but would prove to be major failures in the long run, promoting stock price manipulation (buybacks), abusing the right to utilize creative accounting methods that would hide losses and engaging in risky loans that would hardly pay off. All in the name of instant shareholder - and therefore his own - gratification.

This (audio)book is filled with examples of the above and even includes examples of "Welchisms" being spread across other companies which attempted to replicate the steps of this so-called guru and ended up failing miserably at some point, just as GE did years after. This is a must-read/listen for everyone who learned that Welch's management practices are the gold standard of well-run companies. Hopefully, one will realize that this could not be further from the truth.

[Alberto Schwend · Rating: 5 out of 5 stars]

Excelente relato de un falso mito de exelencia. En realidad Wesh sacó valor de GE, incluyendo malas prácticas y la dejó pesimamente preparada para el futuro, además de solidificar pésimas practicas de gestión de personas y desprecio por la innovación.

[Dylan Adams · Rating: 5 out of 5 stars]

Essential listening if you want to know what is wrong with the world today, and who to blame for it.

[Takondwa Pangalala · Rating: 5 out of 5 stars]

Very informative and I love it, I learned a lot

[Aleyna Staton · Rating: 5 out of 5 stars]

Perhaps the most important book of 2022, or any other year.