Alarmed at the implications of directing corporations to ultimately serve only those who actually provide the capital to fund their business ventures, Labor and Capital vigorously agitates the water in a frantic effort to stir the silt and augment the general leftist miasma required to form a left-favorable argument about the nature of the bottom of the river. I've watched Labor and Capital warily for awhile, as surely its mandate, "...getting the labour movement and the Left to understand the capital markets properly," is beyond hopeless and therefore the author either an idiot (which would seem contradicted by the prose) or possessed of a dangerous agenda and very cunning. This is my favorite part of the recent post:
Hence leaving 'shareholders' in charge of companies must be the right thing to do because they have the self-interested drive to keep them on the right track. It's an elegantly simple idea, but rather messed up by the reality. Hence the identity of shareholders is usually left vague.
Really, I haven't run across a more shortcut laden yet convoluted and obtuse bit of prose since Pevear started translating Tolstoy. I am all for creativity in the written word, but this tendency to obscure basic meaning and torture interpretation in the pursuit of social-political goals must end sometime. The definition of "shareholder" is quite simple. Do you hold a share? You are a shareholder. Don't hold a share? Not a shareholder. Absolutely fucking brilliant, no?
I'm not even going to touch the part where it is argued that because a pension fund holds shares and a pension fund is "the public" that "the public" is a "shareholder." My aversion there is pure self-preservation. I mean really, where in the world could I ever take that argument?
Saying that anyone who has a "direct stake in the success" of a corporation somehow the corporation must be beholden to is beyond dangerous. The IRS (and by extension the treasury) has a direct stake in the success of a corporation. Is the corporation required to maximize the taxes paid by virtue of this "direct stake?" Why not? Same argument. Ah, perhaps the IRS is just slightly less sympathetic a victim than the local union worker. Yes? Well, that particular sympathy should certainly bolster the argument's actual merits, no?
Interestingly, there are a few academic studies on the effects on union cohesion (and power) where corporations are more generious with their equity. Amazingly, "pro-labor" initiatives of the sort advanced by unions fall flat on their face as employees have larger portions of their total compensation linked to equity. Guess it doesn't seem so cool to commit massive amounts of capital to expensive, even ruinous (ahem, Detroit) defined benefit pension plans and headcount commitments when your financial future is actually linked to productivity instead of paycheck extortion. I know it is hard to believe, but somehow it appears that incentives work. Also, I believe the planet already tried out that whole "workers unite" experiment a few times.
Want to use your financial assets in a "socially responsible way" (whatever that means)? Sell your shares and give the funds to the "socially responsible" chairty of your choice. But then stay out of the damn shareholder's meeting.