A bunch of inquiring Congress people got together with a bunch of variously biased academics, bureaucrats and lobbyists to discuss your rights as shareholders on July 27. Shareholders had no representatives present.
The group met under the banner of a Senate Banking subcommittee on corporate governance. Google (GOOG) was held up by one side as a great example of the benefits of ‘limiting’ shareholder rights (by dual shareholder classes in Google’s case). A new front-group social-computing web site was introduced by the government employee union, AFSCME, a sort of Facebook for janitors and RMV clerks that would like to discuss corporate governance in their spare time. In the way Congress hearings always set up fair fights in these events, the hearing pitted a Harvard Law professor against a George Mason assistant law professor; the government-employee union guy against the lobbyist for the Business Roundtable, and an SEC political appointee against a lobbyist for pension funds.
The specific was your right to vote for public-company directors but this unreal séance, which was apparently arranged by the Senator from Goldman Sachs, Charles Shumer, rather than committee chairperson Reed of RI. It branched into a wider agenda including staggered terms for directors, “Say on Pay,” and the causes of the 2008 stock market contraction (also called incessantly by Democrat propagandists “the worst financial crisis since the Great Depression”).
A subtext was whether states—primarily Delaware—should control such processes or whether the Feds should take over even more of your lives. As is the current trend in the new Washington, the way things are done in Europe was held up as an ideal.
I found it ironic that everyone objected to directors being elected by a plurality of rather than majority of shareholders in proxy votes. No one had the temerity to note that that is exactly how Congress people (and most U.S. politicians) are elected.
Most important of course there was no mention of the fact that shareholders vote every day, when they buy and sell a company’s shares. Not satisfied with screwing up the auto industry and the healthcare delivery process, the left-wing is moving on to really affecting you where it hurts, in the pocketbook.
Shareholders, meet your future: Obamadaq.
-- Dennis Byron
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